A title company serves as the Police Department for the real estate transaction. They make sure everything is completed and in order so that the closing actually takes place. They have the power to stop a transaction from closing if it is not in order. They are a necessary evil and a most important one at that. Rely on them to make sure that the buyer is safe and not sorry at the closing table.
Title insurance is the opposite of car insurance. You buy car insurance for something that may happen in the future, like a car accident. Title insurance, on the other hand, is insurance for the past. It guarantees that if someone comes up some day and says they are the true owners of the property that you thought you bought and they are in fact correct, you are covered and a necessary resolution will be found.
A title company is responsible for many functions in the real estate transaction, including:
- Running a title search
- Issuing title insurance
- Making sure the final figures are correct
- Conducting the closing for the lender
- Dispersing the monies to the appropriate parties including the seller, lender, unpaid invoices of the seller or the buyer.
- Provide a flood letter ordering and providing a survey of the property for the lender and the buyer.
- Coordinate with the seller’s title company if it is different than the buyers for any exchanges of documents and they do not release the seller’s funds to the seller until everything has been completed.
The buyer has the choice of picking which title company they want to use. This is done on the face of the contract. The buyer has the title company hold the earnest money for them. The buyer then sits back and lets the title company do the rest. Title insurance is very competitive so you can shop the cost of the insurance and normally the title company you chose will match whatever quote you find, as long as the company is legitimate.
Closings normally take place at the office of the title company. First up are the lenders documents followed by the title company documents. WORD OF CAUTION: 80% of all closings take place on the last 3 days of the month. can pick any day to close on and I HIGHLY recommend that do not pick one of the last 3 days of the month. If it is necessary, then make sure your closing is the first or second of the day, otherwise it’s like sitting in the license bureau waiting all day long for the people in front of you to get done.