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What Does A Title Company Do?A title company provides many of the services needed in finalizing a deal when selling property. The two main services that one may have questions about if you have never been exposed to such terms are escrow and title insurance. Escrow Escrow officers are usually employed by a title company. These officers handle the paperwork and money involved in the sale of property. The process is called escrow. Who opens escrow? A realtor, sometimes an attorney, or the seller if you are a for sale by owner and/or offering seller financing may open escrow. When the escrow agent is contacted they open a file and issue you an escrow number, which is used to identify this transaction throughout the entire process. What is involved in escrow? The escrow agent will need all the information about the property. -address -current owner -prospective buyer -buyer's lender (or let them know if you are offering seller financing.) -outstanding loan information -sales price -instructions for expected closing date and any commissions to be paid. If other information is needed they will ask. The escrow officer verifies all information. They will also find out: -if a home warranty will be taken out on the property -when a termite report will be completed
After you open escrow, the officer will order a preliminary report. It could take a few days. The title company researches the public records to check if anything is encumbering the property, such as liens, judgements, taxes, easements and deeds of trust. Then the title company issues a preliminary report. The escrow officer reviews the report and lets you know if any matters need to be cleared before closing escrow.
There is only a one-time premium for title insurance. Title insurance is bought to guarantee that all events in the past related to the property have been cleared. This assures that the title company has not missed any important information that might affect the property. This is important since it was the title company's responsibility to research the public records of the property and make sure their aren't any liens, judgements, easements, deeds of trust, or outstanding taxes.
The escrow officer will have a list of what needs to be completed before closing. These may include: -buyers deposit (earnest money) -loan documents -terms and paperwork if using seller financing -fire and other insurance policies -home warranty -termite report -title insurance policy -requests for payment (for services that will be paid from the escrow fund) Everything the escrow officer does must be requested or instructed in writing.
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