You’ve been looking for a home for a while, and now you’ve found one. Along with the seller and the mortgage lender, you will typically have a title company that you are dealing with as part of the process. Why are they part of the process, and what do they have to do with the transaction of purchasing a home?
Title companies like Ector County Abstract & Title are important to the process of real estate transactions. There are a number of aspects that a title company brings to the table to help ensure that all parties are satisfied with the transaction.
Verifying The Property Title
A title company basically has one main job, and that is to research a property to ensure that the title is clean. In most cases, the title to a property is just fine and things progress as normal. However, in a few cases, the title to a property has some issues, such as some property taxes that were unpaid from a couple of decades ago. Who pays that tax? What if the person who owes it is now dead? A title company will help to clean up an encumbered title.
Property Survey
In some cases, a title company will require a property survey to be done on the property in question. The reason for doing this is to determine where the property lines really are as well as to find out if neighbors have been encroaching on the property with fences, buildings, and more. They will also look for easements for the property to see if a neighboring property has the ability to cross the main property for some reason.
Title Insurance
Once a title company has researched a title and presented a clean bill, they will often offer up title insurance. This insurance is designed to cover themselves in case something unusual comes up after the transaction that they did not catch in their initial research. This helps to make sure that the lender and the buyer will not be out any money.
Performing as an Escrow Company
An escrow company or agent is the one who holds the assets until the transaction is completed. A transaction is completed when it receives the appropriate instructions or until predetermined contractual obligations have been fulfilled. The agent maintains a fiduciary responsibility to all parties involved in the transaction. Once the sales process begins, documents and money will need to be exchanged between the parties involved, and the escrow company facilitates this. All money, funds, titles, and securities involved in the transaction are maintained during the closing process by the escrow company and until the property legally changes hands.