Buyer Services
A title company plays a crucial role in a real estate transaction, particularly for the buyer. Their primary responsibility is to ensure that the property being sold has a clear and marketable title, meaning there are no legal issues or claims that could potentially affect the buyer's ownership rights. Here's what a title company typically does for a buyer:
Title Search: The title company conducts a thorough investigation of the property's history to identify any potential problems with the title. This involves examining public records, deeds, mortgages, liens, and other documents to verify the ownership history and any existing encumbrances.
Title Examination: After gathering information from the title search, the title company's legal experts review the findings to determine if there are any issues that need to be addressed before the property can be sold. This could include outstanding debts, unresolved legal disputes, or other claims against the property.
Title Insurance: The title company issues a title insurance policy to the buyer. This policy protects the buyer and their lender from financial loss in case any undiscovered title issues arise after the sale is completed. There are two types of title insurance: owner's title insurance (protects the buyer) and lender's title insurance (protects the lender).
Clearing Title Issues: If any problems with the title are found, the title company works to resolve these issues before the closing. This might involve paying off outstanding debts or negotiating with creditors to release any liens on the property.
Escrow Services: The title company often acts as an escrow agent, holding funds and documents in a secure account until all conditions of the sale are met. This includes ensuring that the seller has fulfilled their obligations, and the buyer has provided the necessary funds.
Closing Services: The title company plays a central role during the closing process. They facilitate the transfer of funds and ownership documents between the parties involved. The title company ensures that all legal documents are properly executed and recorded with the appropriate government authorities.
Recording Documents: After the closing, the title company ensures that the new deed and other relevant documents are properly recorded with the county or municipal land records office. This formalizes the transfer of ownership and helps establish the buyer's legal rights to the property.
Disbursement of Funds: The title company ensures that all parties receive the appropriate funds as specified in the closing documents. This includes paying off any outstanding debts or fees associated with the property.