Title companies are invaluable allies in navigating the complexities of a property purchase. The title agents at your chosen title company are responsible for conducting the title search, an exhaustive examination of all public
records concerning the history of the property you plan to purchase, to determine if the title is clouded by “defects.”
Such clouds or defects, such as unpaid tax bills, unsatisfied liens, or boundary disputes, can render the title uninsurable until the problem or problems are resolved. The title agents then issue a clear title and the purchase may proceed.
Title companies will also offer title insurance to protect the buyer and/or the lender, should any problems with the title surface in the future, after the purchase of the property has been completed. The title company will stand with the insured, helping pay any loss or legal fees and even defending the title from any future challenges
Title companies may also handle other vital procedures involved in the purchase of property, such as the preparation of closing statements (required by HUD) and Deeds of Ownership, providing escrow services (holding earnest money from the eventual buyer, mortgage payments, and distribution of
the sales proceeds) and handle closing coordination (arranging not only the time and place for signing, but the transfer of ownership as well.)
Choosing a reputable title company is crucial to a proper property transfer. Here are some things to consider when choosing a title company:
Choosing an independently owned title company (as opposed to those affiliated with your mortgage company) prevents any conflict of interest situation. A sterling reputation and solid experience are two other factors to consider when selecting a title company. Do your research and pick a company that is not only reputable, but also ethical, detail-oriented and professional. Your Realtor is
usually able to recommend a title company with whom they’ve worked in the past. Speed and clarity of communication should also be considered. Delays in response or lack of clarity can slow down the purchase process.
It is best to choose a local title company if you are making a local move as the company may be more knowledgeable about the local area and their location makes meeting the title agent in person much easier. However, if you are moving across the country, be sure to choose a title company that operates nationally or one that is located in the area to which you are moving.
Ask questions about the title company’s fee structure. Fees can vary from title company to title company (beware, too, of hidden fees) and bear in mind the least expensive company is not always a bargain. When it comes to title company services, you truly do get what you pay for and you need clear, prompt, thorough service to ensure the title to your new property is free, clear and legal.
Therefore the choice of a title company is a vital one, as the correct choice will save you both money and future trouble.
For more information on title companies, visit the website of the American Land Title Association (ALTA) by clicking here.