question about refinancing and the legal jargon that goes with...

[madmom]

my hubby and I were talking to some people about refinancing and they did a proposal and all that stuff that happens in this case, well to make a long story short we told them we decided to wait awhile and not go through with it. Well today in the mail I receive a "Notice of Availability and Offer Of Closing Protection Coverage" from one of them. Now my question..what the hell is this? It says:

Premium costs: the premium cost for closing protection coverage is $35.00 for lender, $50.00 for borrower and $15 for any other applicant for title insurance and in no case shall the premium cost less than $35.00 for this coverage in any transaction."


something here sounds fishy am I wrong? again does anyone know anything about what this might be? Thanks .

[Lex]

1. Looks like an offer of title insurance coverage kicked off by

your recent inquiry about refinancing.

Why would that be "fishy?"

[northzax]

2. it is to protect you-

theoretically. the idea is that this is insurance to protect you from your agent stealing your money during closing. It seems to be an Ohio thing now that it is mandatory to offer it. Basically, you are insuring your escrow money from vanishing if your agent skips town.

[DURHAM D]

4. Its a refinance.

My guess is that the letter was sent in error because the data base does not distinguish between refi and initial closing.

[pscot]

3. Sounds like it might be an option

to close the deal at some future time, possibly at the same terms. You can probably just disregard the offer. If you're really curious, call and ask what it means.

[SoCalDem]

5. If you did not sign any papers, just shred it and call & tell them to

"lose your address"..:)

[Gormy Cuss]

6. I believe that it was triggered by a change in OH law.

It's an insurance product previously offered to lenders to protect them against fraud by title company employees. The new law extends the insurance product to consumers. I'm not in a position to advise on whether someone should opt for it, just giving you and FYI on why you've never seen such a thing before.