The Title Company’s Role in Real Estate

     Buying and selling a home is a big step.  It is an investment of a lifetime for buyers and a chance to move forward on the seller’s side. After choosing a home, the next thing to do now is to secure a title of the property from a Title Company.  A title gives the new owner a right to use and claim the property. It is important that you thoroughly understand the services provided by such companies.

The Title Company’s Role is as follows:

1. Takes charge of receiving the earnest money. A buyer, who is serious in buying, is required to give the company a certain amount of deposit, otherwise known as the earnest money. If the sale will push through, this amount will be credited to the down payment, and if it will not, it could not be given back to the buyer unless otherwise agreed upon in writing.

2.  The company will make a thorough search of the home title. This process is to check the records of the property. It serves to verify the rights of the seller to transfer ownership. This will reveal any demands, liens, faults, privileges or restrictions on the subject property.

3. After completing a search of the title, the company will then proceed to a Commitment of Title Insurance. It is issued to the lender and copies are made available to the buyer, seller, lawyers and the realtor. This will set forth exceptions and matters that must be satisfied before the issuance and settlement of a title policy. Normally, the seller provides at his own cost, an Owner’s title Policy to the buyer, unless agreed otherwise. Usually, the mortgage lender would require that the buyer secure a Mortgagee’s Title Policy for their benefit. Both policies will give financial protection from adverse title claims, hidden defects and risk to the insured.

4. Between the time of receipt of the contract and the final settlement, the title company will maintain close contact with the mortgage lender, the lawyers and the realtor. This is important in order to obtain the documentations necessary for the closing of the deal.

5. As soon as the closing date is set and scheduled, the lender or the attorney will send the necessary documents like the Deed of Trust, Warranty of Deed, etc. and instructions on the closing to the title company’s escrow officer. The officer will compile all lenders’ charges, title fees, miscellaneous fees and other closing costs into a final statement of settlement. At this point, the buyer will be informed of the amount of money he or she has to bring during the closing. When everyone is around during the closing schedule, the papers and fees will be explained by the escrow officer, reviewed and executed.

6. The title company assumes the responsibility of collecting the funds for an accurate and prompt disbursement of these funds. After the closing is made, the company will make sure that all legal documents are filed for recording, the lender’s requirements fulfilled and the necessary paper works returned and all outstanding liens are paid in full and the title policies sent.

7. A title company plays an important role in the selling and buying process in real estate and establishes regular involvement from the time a contract is signed until the completion of the transfer of ownership. They work to ensure that this procedure is done in accordance to the instructions of all involved parties in the most pleasing and effective manner.  Service is a top priority in a title company.