The Title Company’s Role In a Tampa Real Estate Closing

May 29th, 2007 categories: Keller Williams, Tampa Real Estate, Tips for Sellers

Many of our clients don’t understand exactly what a title company brings to the table (literally) at closing.

Here we go:

The services a title company provides are best divided into two categories:

• Providing title insurance
• Providing services to close the transaction

Providing Title Insurance To Tampa Home buyers

What is title insurance? Title insurance is an insurance policy issued by an insurer that protects the home buyer from any defects or problems that may arise concerning title to the property after the purchase. Prior to closing, the title company will perform a “title search” to inspect the history of the property to make sure that no outstanding claims or liens exist, and that title was transferred properly to each new owner. TIP: If you are a seller, speak to a title company before listing your home for sale to avoid problems that may arise at or just before closing, and get an estimate on the cost (sellers usually pay for the new owner’s title policy).

If all is well, the insurer will issue a title commitment for the property. If the buyer is financing the purchase, the lender will need a policy to insure them for the same since they will hold a substantial interest in the property. This policy, know as the “lender’s policy” is purchased by the home buyer. Prices of title insurance can vary from one company to another, but are usually within a tight range.

Closing Services

The other service that the title company provides is the actual closing of the transaction. The closing agent works with both the buyer and seller parties, as well as the buyer’s lender if the home purchase is being financed. Once the closing is scheduled, the title company will usually provide space at the company’s offices for all parties to meet and sign all required documentation. Fees are charged to both buyer and seller for the services provided by the closing agent. The most common is the “settlement” or “closing” fee. The amount of this fee can vary from one company to the other and is usually a charge to both parties. There is usually a title search and/or title examination fee charged to the seller. Other fees that may be charged are document preparation fees, attorney or notary fees, courier or shipping fees, etc. After closing, the title company will pay off any seller mortgages, record the satisfaction of mortgage, pay the seller (if the seller comes out ahead) and any brokers, and have the deed (sale) recorded for public record.

Since the seller usually provides the owner’s title policy, the seller usually selects the title company to provide the insurance and the closing services.

Tip to sellers: While the cost of title insurance can vary somewhat, the fees charged to both parties can vary quite a bit. Shop it around. Quality of service is important.

Tip to buyers: Since the seller usually selects the title company, buyers do not have much say with regard to their title fees. Buyers are encouraged to ask questions about charges and to work closely with their Realtors to make sure they are not being over-charged.

Further Reading:

Why Title Insurance?

Title Insurance Success Stories

Settlement Costs

See “What’s Wrong With The Title Insurance Industry”

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Gurvich Realty Group of Keller Williams

This entry was posted on Tuesday, May 29th, 2007 at 9:56 am and is filed under Keller Williams, Tampa Real Estate, Tips for Sellers. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

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