Title insurance may not be the sexiest corner of New York City real estate, but homeowners, developers, attorneys and lenders can’t do business without it.
Yale classmates Daniel Price and Seth Brown were inspired to start their insurance underwriting firm after years of experience in finance and real estate development. They opened their doors in February at 222 Broadway in the Financial District. “I’ve had problems where I entered into transactions and almost lost a deposit because of title problems caused by the whole model, where the agent doesn’t have the necessary authority or expertise,” said Brown, who previously worked in development for the Hudson Company, LeFrak and his own Aspen Equities.
The key to lowering prices and increasing transparency, Brown said, was eliminating agents. OneTitle works directly with homeowners, developers, attorneys and lenders, offering title insurance, real property and cooperative lien searches and more.
Title insurers and operators in New York State often file their rates together, which Price and Brown maintain artificially inflates rates. “We’ve sort of broken the cartel in New York,” said Price. “Because we work directly with clients and their attorneys, our rates are less expensive, especially on more complex commercial transactions or with investors who are under time pressure to get deals done.” They said OneTitle’s rates run 10- to 15-percent below industry average. The firm has nine employees, and is backed by private equity and insured by Lloyds of London, said Price, a former consultant with McKinsey & Company and principal investor at Moelis Capital Partners.