What is a Title Company and What Does it Do

What is a Title Company and What Does it Do?

When buying a new home, you need to deal with several different types of companies, one of them being a Title Company, which will have several key roles in your real estate transaction. Read on to learn what Title Companies are and how they can help you.

What Does a Title Company Do?

In a real estate transaction, your Title Company will:

• Carry out a title search to confirm the validity of the title to the property.
• Serve as an escrow agent, holding and distributing the funds involved in the transaction.
• Ensure the seller is legitimate and has legal rights to sell the property.
• Issue a title insurance policy for the buyer and the lender, which will protect them against any claims or unknown issues with the property.
• Order a property survey.
• Act as a closing agent in the transaction.

Carrying out a Title Search

This is one of the most significant duties your Title Company will perform in your transaction. A title search will enable you as the buyer to gather important information on the history of the home you intend to purchase. The main purpose of the title search is to uncover any outstanding issues with the property, such as:

• Unpaid taxes
• Debts of previous owners
• Special assessments
• Judgments
• Unpaid HOA fees
• Ownership claims
• Liens for unpaid taxes

Serving as an Escrow Officer

In a real estate transaction, your Title Company will typically act as an escrow officer by holding the funds necessary to complete the transaction and any important signed documents under the specific instructions of either of the parties involved. For example, the seller may surrender a signed deed to Title Company, while the buyer may transfer the funds necessary to complete the transaction to an escrow account controlled by the Title Company. In this example, the Title Company will release the signed deed and the funds as instructed by the parties in writing.

Making Sure the Seller is Transferring the Property Legally

Your Title Company will carry out comprehensive research on the history of the property you intend to buy. One of the main purposes of this research is to determine whether the seller is the legitimate owner of the property and has the maximum rights to sell it. In cases where, for example, the original owner of the property has passed away and one of his or her children is selling the property without involving his or her siblings, the Title Company handling the transaction will uncover this issue and promptly inform the buyer of the situation.

Issuing Title Insurance

Once your Title Company establishes the validity of the title to the property you intend to purchase, they will issue a title insurance policy. Generally, title insurance protects the new owner of the property from any issues that may arise from the previous ownership, among other problems. The biggest advantage of title insurance is that you only need to pay a one-time premium based on the value of the property and you will be protected for as long as you own the home you purchased, with no extra fees required.

Ordering a Property Survey

Most lenders will usually ask for a location map of the property, which is why your Title Company will order a survey on it and then review it to make sure that no issues will arise during closing or later on. If the Title Company detects any issues, they will promptly notify both the buyer and the lender.

Acting as a Closing Agent

Typically, your Title Company will act as the closing agent for your real estate transaction, serving both the seller and the buyer. This means, essentially, that the Title Company will receive and surrender all kinds of payments related to the transaction as well as obtain the required signatures on all the documents involved.

Reach out to Marina Title for more information about all the services we provide. Call us today at (305) 901-5628 or send us an email to info@marinatitle.com to schedule an initial consultation with one of our title experts.  Our list of satisfied clients is long and grows every week. Let us add you to it!