Top 5 Title Company Responsibilities
August 01, 2018Buying or selling a house entails a lot of details and can be a stressful situation. That's the reason why most people who buy or sell real estate take advantage of the services provided by a title company. Since there are so many details involved in the buying and selling of real estate, title companies are responsible for bringing all of the elements together and overseeing the closing process from start to finish. Good title companies are also available to answer questions throughout the entire process, from the moment a client picks out a house to the moment when the sale is complete, everything is in order, and the closing happens. A title company, in fact, acts as an agent for both the buyer and the seller as well as an agent for the title insurance company that will provide title insurance. That does not mean only one title company is used. Sometimes the buyer and the seller will have their own title company agents.
Top 5 Title Company responsibilities
- Reviews title and performs title search
- Issues title insurance policies
- Manages escrow and distributes final paperwork
- Oversees closing
- Files and records all paperwork associated with transaction
A Title Company Reviews Property Title and Performs Title SearchReviewing the title and performing a title search is one of the most important responsibilities a title company handles. A title has to be free and clear for the seller to legally transfer the title over to the buyer. In most cases, transfer of a title goes without a hitch. Unfortunately, there are issues that could arise that would prevent the transfer of a title. Some of the unforeseen problems a title might have include unknown or forgotten liens on the property, right of survivorship claim, which means someone else could claim the property if one owner passes away, construction liens, court judgements, or undiscovered inheritance claims. The title company will review a title and perform a title search looking for these problems, which are known as clouds on the title. Clouded titles must be resolved before any transfer of the title can occur. This is one of the biggest reasons having a title company is so important.
A Title Company Issues Title InsuranceThis brings us to title insurance. There are two types, a lender's policy and an owner's policy. In the state of Florida, and in most states, any federally insured lender, and most other lenders, will require title insurance for the lender. That ensures the lender is covered should an issue ever arise with the title that wasn't uncovered during the title search. Title searches are thorough and typically very accurate, but there may be situations that may not be noticed until many years after a property has been purchased. Title insurance covers any loss due to these unforeseen issues to the lender if there is a lender's policy in place and to the buyer if there is an owner's policy (or buyer's policy) in place. Even if it isn't required by law, getting a title insurance policy is worth it. It's a one-time fee that is often paid for by the buyer or worked into the loan total.
A Title Company Maintains an Escrow Account for Closing Documents and FundsAnother title company responsibility is setting up and managing an escrow account. This is not the escrow you have set up through a lender to pay property taxes. This is an account set up to hold all of the money and documents related to the closing of the property. The escrow account will be overseen by a title agent from the company. An agent from the title company will disburse the title and money when the closing is complete. The purpose of having a title company keep the money, title, and other important documents safe and secure is to ensure nothing is distributed to the wrong person at the wrong time.
In addition to overseeing the escrow account, a title insurance company can help both the buyer and seller track what has and hasn't been done for the closing to go forward. A title company can be available to remind buyers and sellers of any inspections that need to be performed for a sale and transfer of a title to take place and a title company makes sure all of the necessary documents are signed appropriately during the closing process. The title company also ensures documents are legal and properly filled out before they are held in escrow for the closing date.
A Title Company Oversees the ClosingBuyer and seller meet at the title company when it's finally time to close on a new home or property. There may be others present, including a lawyer, a realtor, or anybody the buyer or seller might want present. The buyer and seller do not necessarily need to be present at the same time, and if they have separate title companies, it won't be the case. An agent from the title company explains all of the paperwork and oversees the signing of the paperwork. When the closing has been completed, the buyer gets the title, the seller gets the money. It is the responsibility of the title agency to ensure every stop of the process is understood by explaining everything that takes place during the closing.
What Documents Are There for a Closing?There will be a deed. This document transfers the property to the buyer. Recording of the deed is the responsibility of the title loan company. Recording the deed shows you are the owner of the property and that you purchased it from the previous owner and that the transfer of title was legal. There is also a bill of sale, which transfers any personal property being sold with the house. This document is a list of anything being sold and transferred with the house.
The affidavit of title or seller's affidavit will also be present. The name of the document is different from state to state, but it is a sworn and notarized statement by the seller that confirms the seller is the legal owner of the property and that there are no liens, leases, disputes of property lines, contracts for the sale of the property, outstanding debts that could cause liens on the property, or any other situations that could affect the seller's right to transfer the title.
There is also transfer tax declarations. If you are in a state, county, or municipality that charges property transfer taxes, you will be required to sign declarations disclosing the purchase price for tax calculation. There will also be the note, which shows you have a debt with a lender. This will have the terms of the loan clearly outlined, including the amount of the debt, the interest rate, and the value of the note itself. There's also the mortgage, which states you are putting up the property as collateral in case you default on the loan, the original loan application, and a loan estimate/closing disclosure. By the time the buyer has arrived for closing, the seller will have already signed all of the paperwork necessary for closing. After the closing, the title company will file all of the paperwork to legally record the transaction.
As you can see, there are a lot of responsibilities associated with the closing of a sale on a home or property. That's why so many buyers and sellers prefer using a professional title company to assist with all the fine details of closing. In Florida, the best title company is Key Title & Escrow. We've been serving the real estate industry for more than 23 years. At Key Title & Escrow, we take our responsibilities serious and handle each of our clients with care and professional business practices. We have developed a solid reputation over the years for facilitating efficient, stress-free closings that leave our customers happy and satisfied. At Key Title & Escrow, we take pride in everything we do. We provide customer service that adheres to a high set of professional standards. Our reliable service and our absolute commitment to doing a great job for you is our only priority. If you are looking for the best title and escrow services in Florida, make Key Title & Escrow your choice. We are big enough to get any job done yet small enough to make every closing a personal closing.
For your convenience, we offer after-hours closings and closings statewide. We always have your best interest at the heart. Our number one goal is to provide you a stress-free closing. If you're ready to buy or sell, contact Key Title & Escrow to see how our closing and escrow services are the best closing and escrow services in Florida.
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