Most people buy under 3 homes over the entire course of their lives. There are several professionals that are necessary for even the most typical real estate transaction, and title companies are no exception. Due to the high dollar amount of most real estate these professionals represent and protect assorted parties interests in the property.
The most important responsibility that title companies have is to make sure that the title goes from the seller to the buyer easily and actually is what it is supposed to be. If it supposed to be a 10 acre parcel, the title company ensures that, as well as any existing liens or other encumbrances on the property.
The title company makes sure any and all liens, including mechanics liens and tax liens, are taken care of before the transfer. They also confirm legal boundaries just in case there may be a discrepancy.
Realtors involve the title company as soon as they have an accepted contract by sending the file to them as soon it is signed by all parties. The title company immediately confirms all compliance with pertinent laws and regulations and then oversees the transfer of title and the following responsibilities as well
Confirming the identity of the sellers
The confirmation of the seller’s identity and their legal ability to transfer the property is verified at this point by the title company. Then they submit all necessary legal paperwork as well at the appropriate time.
Property has Clear Title
The title company also confirms that the buyer can take title in a clear manner. This confirms that all liens and encumberances have been cleared out and there are not any other remaining issues with the title.
Insuring the title of the subject property
The title company also sells the buyer a form of insurance protecting them against any future difficulty with the title called “title insurance”. This insurance policy takes care of any legal and administrative costs in settling any disputes involved in the title transfer. Both, the buyer and the lender purchase title insurance policies to protect their own interests.
When a title company is satisfied with respect to title of the property, they issue a document called as the “Commitment of Title Insurance” to the mortgage lender along with a copy to the other parties involved in the deal i.e. the buyer, seller, realtor and the real estate attorney. As a buyer it is essential that you understand the role and responsibility of the title company.
Your responsibility to investigate the property you are interested in doesn’t stop at trusting the professionals you hire to take of things. You must also act to disseminate the liability of the transaction through as many responsible entities as necessary for your own protection.
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