As a homebuyer or seller in NorCal, you have probably heard the term “title company” thrown around during the real estate process. But what exactly IS a title company? The short answer is that they play a critical role in the buying and selling of real estate! The long answer? In this post we’re breaking down the 7 things you need to know about title companies to help you navigate the buying or selling process with ease.
- Title Companies Conduct Title Searches
The primary function of a title company is to conduct a title search on the property in question. This means researching public records to ensure that the property’s title is clear and can be legally transferred to the buyer. During the title search, the title company will look for any liens, encumbrances, or other issues that may impart the property’s ownership.
- Title Companies Provide Title Insurance
To protect both buyers and sellers from unexpected issues with a property’s title, title companies provide title insurance. Title insurance is a one-time fee paid by the buyer or seller that protects them from any claims or losses that may come from issues with the property’s title. This could be things like hidden liens, forgeries, or mistakes in public records.
- Title Companies Act as Escrow Agents
In many transactions, the title company also acts as an escrow agent. This means that they hold onto the buyer’s earnest money deposit and any other related funds until closing. Once the transaction is final, the title company distributes the funds as necessary.
- Title Companies Coordinate the Closing
Additionally, the title company is responsible for coordinating the closing of the transaction. This includes scheduling with both the buyer and seller to sign the necessary paperwork, and ensure that all necessary parties are present. The title company facilitates the transfer of funds and the recording of the deed with the appropriate government agency.
- Title Companies Offer Closing Protection Letters
To protect buyers and sellers from any problems that may come up during the closing process, many title companies also offer closing protection letters. These letters provide additional protection to the parties involved in the event that the title company were to make an error or commit fraud during the closing process.
- Title Companies May Help Resolve Title Issues
If an issue with the property’s title were to show up, they can help to resolve them. This means working with the seller to clear up any outstanding liens or encumbrances, or working with the buyer to address any issues with the title insurance policy. In some cases, the title company provides legal support to help resolve any disputes related to the property’s ownership.
- Title Companies Can Offer Additional Services
In addition to their core services, many title companies also offer additional services to buyers and sellers. This may include things like home warranties, notary services, or even assistance with moving and storage. Be sure to ask your title company about any additional services they offer that may be useful to you during the real estate process!
A title company is a key player in the real estate process, helping to ensure that the transfer of ownership is legal and smooth for everyone involved. By understanding the role of title companies and the services they provide, you can approach your real estate transaction with confidence and peace of mind. Are you ready to buy or sell a property in Sacramento? Find out how MegaBliss Real Estate Inc. can help you today! (916) 949-6929