What Is Title?
“Seller title” refers to the ownership rights to a home that is listed for sale.
You must get a clear title before a mortgage can close. This means that any liens, debts or other claims on the property need to be resolved.
The title company is responsible for finding anything that can hinder a clear title, and, if anything is discovered, they will take corrective action to enable the transaction to go through, which allows you to have title insurance, to continue on in the loan process, and will provide you peace of mind about your investment.
What does the title company do?
A title company handles the review of any title claims and prepares for the closing.
A mortgage loan officer manages the escrow account, which holds funds that must be set aside for the home purchase or refinance until certain conditions are met or the transaction is complete and the funds are disbursed to the necessary parties with title and settlement services.
This process works like this: If you’ve made an earnest money deposit to purchase a home, you’ll be required to make monthly payments to the seller until you close the sale. These payments will be held by the title company in their escrow account.
Although title insurance companies aren’t seen as much during a loan transaction as your real estate agent or lender, they are equally important parts of the team.
They have to be ready to close your business deal by any means necessary.
1. Title search and examination
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Your title company will look into the history of the property to make sure that no problems exist.
This is commonly referred to as a title search. It shows the previous owners of the home and any financial trouble that may have occurred during the previous property’s ownership.
For home purchase transactions, the Property title search will also identify all owners who have interest in the transfer of the property and who will be required to execute vesting documents at the time of closing.
2. Fix any errors and resolve title issues
The title company will review the policy and make any changes that are necessary to get your closing on schedule.
They may talk to the homeowner to learn more about ownership issues, and they may request documents to prove that someone else owns the home.
For example, if the problem involves a bill for a completed construction project, the title company will need to resolve it with the current owner and contractor.
