Title Companies And How They Can Help You

When you are buying or selling a house and you have a fully executed contract the next step is opening escrow with a title company. For many buyers and sellers, title companies remain something of a mystery and they don’t understand why they should be included in the procedure.

Title companies provide an important service during the final stages, including protection for both sides of the deal. So what is this protection that title companies are offering? Referring to a title that the new owner obtains, which must be totally free of liens or other problems overshadowing it, a clear title is truly guaranteed by the title company. Unless a title company is able to produce a clean title report, such a cloud over the deal can cause the purchaser to walk away, unless of course the title company is capable of clearing up and guaranteeing the title for the buyer.

Such a title company will furthermore strive to resolve additional details, such as obtaining public reports, conditions, covenants, and restrictions for the community itself and handing them over to the purchaser to consider. They also take care of all of the signatures for both seller and buyer. For the buyer, this means signing the loan documents that have been forwarded to the title company as well as the title documents and for the seller it means signing over the property with the deed that the title company has drawn up.

Once all parties have signed and the loan documents go back to the lender for funding then it all comes back to the title company again for them to send it out for actual recording which officiates the transaction and puts the home in the name of the buyer and pays off the current loan and attaches the new loan to the property. Finally, the title company obtains the monies from the purchaser for the closing costs as well as down payments, and then they turn over all of the monies to the seller, after the home has been fully registered and the sale closed out.

Many title companies have folded or reduced their number of offices in the current home crises but consolidating is common in a market like this. You should make certain that you are dealing with a title company that has existed for a good while. The buyer generally has the option of choosing the title company unless the home is bank owned and then the bank will generally use one title company for all of their homes.

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