What is the role of a title company?
A good title company takes the worry out of your settlement. When a title company receives your file a chain of events occurs. They make sure that the seller listed on the contract is indeed the owner of the property being sold. From that point they will conduct a title search. This research will show if there are any liens or judgments against the seller that are attached to the property being purchased. Should any issues arise, your title company will take care of clearing any title defects. At the settlement table, the title company collects of all funds from all parties involved. A title company also transfers ownership and issue title insurance for both lender and purchaser.
Why do I need title insurance?
A title insurance policy guarantees that the title to the property is free of “hidden” liens, hazards or human errors. When title insurance is purchased an experienced title examiner performs a comprehensive search of the public land records to determine if any liens or other encumbrances are attached. Although this search is intended to report all material title objections, there is always a chance that the substantial issues may go undetected. For example, an unknown heir of a previous owner who has a valid claim against the property, unrelinquished marital rights of previous owners, or invalid signatures. An Owner’s policy protects your interest in the real property against such unforeseen threats to your ownership.
To protect against risk, a lender will require assurance that the title to the property is clear; and this is done through the issuance of a loan policy. The lender’s policy covers the lender only, while the buyer is unprotected without the issuance of a separate owner’s title insurance policy.
For a one-time premium, paid during the closing process, an owner’s title insurance policy protects against future losses arising out of events that may have happened in the past. Your policy serves as a written guarantee that your underwriter will undertake, at its own expense, the defense of your title in all legal actions or proceedings alleging title to be other than as insured.
What does title insurance cover?
- Forged deeds, releases or wills
- Fraud in connection with execution of documents
- Clerical errors in recording legal documents
- Wills not properly probated
- Undisclosed or missing heirs
- Dower or curtsey rights of ex−spouses of former owners
- Unsatisfied claims not shown on record
- Deeds executed under expired or false powers of attorney
- Liens for unpaid taxes
What is a “title search”?
A search made by a title company to determine whether or not the seller actually owns the property. The search will also provide information such as the history of ownership to the property, and determines if any liens, open permits or illegal extensions exist on the property.
What do I need to bring with me to settlement?
You will need to bring a valid government issued photo ID, for example: Driver’s License, Passport, or Military ID. Any and all monies that are collected during the settlement must be in the form of certified funds which can consist of a cashier’s check, teller’s check, money order, or certified personal check or wired funds to our office. . Should you be bringing cash to the settlement, please let us know before hand. Only small amounts of cash are expectable. If additional documents are needed, our staff will contact you and let you know what is needed prior to settlement.
How long will my settlement take?
Depending on the type of transaction you are settling on, refinances can generally take from 30 to 45 minutes, while a purchase will take 45 minutes up to an hour and a half.
When should I set my appointment with my title company to arrange my settlement date?
If your transaction is a purchase you should contact your title company right away so that they may start conducting the necessary steps we need to take to obtaining a clean and clear title for your new property. This allows your title company to work best for you and allows us to coordinate the settlement with all parties involved. If you are refinancing, you should contact your title company once you have submitted your loan application. Once your loan is submitted, your title company will be working hard during that time to obtain a clean and clear title and then will be able to move forward towards your settlement date.
Can my settlement be conducted if I am unable to attend?
In some situations a “power of attorney” would be drafted for you in the case that you are not able to attend the settlement. A power of attorney is a legal document that is prepared, that allows another individual to sign legal documents in your absence. Please contact immediately if you feel you will not be able to attend your settlement.
Pre-Settlement Checklist
Hazard Insurance Policy
Your lender will most likely require that a current hazard homeowner’s insurance policy be in place before your settlement.
Pest Inspection
Inspections usually have to be performed for purchase transactions. The sales contract indicates which party is responsible for the order and delivery of the inspection and invoice. Please note that inspections are typically required for loans closing under a Veteran’s Administration program. Check with your lender.
Lender Documents
To prevent possible delays in closing, it is imperative that the purchaser furnishes any necessary documentation to their lender for final loan approval. It is also a good idea to bring any documents you receive from your lender (estimates, truth in lending, lock−in letters, etc.) to closing.
Certified Funds
A cashiers or certified check made payable to the title company is required to cover closing costs and the remainder of your down payment. A wire transfer is also an option in most cases; so, contact your title company for further information.
Photo ID
A valid government−issued photo ID, such as a driver’s license or passport, is required at all settlements.
Utility Notice
Purchasers must contact their utility companies to open or transfer power, gas, and water accounts. Utilities should be turned on for purchasers’ walkthrough so they can ensure appliances and heating/cooling systems are functioning.
