A title company is integral to many real estate dealings, whether you are the buyer or the seller. A local title company's responsibilities include investigating any claims against the title, providing title insurance, handling the closing, and holding certain money in escrow until it is ready to be distributed. The following article explains the services offered by companies like Ticor Title Company of California and provides some guidelines for dealing with them.
In layman's terms, a local title company investigates the history of a property's ownership. In addition to representing the lender, they may also act on behalf of the buyer or seller. A real estate deal would not be complete without the title company. Buyers may lawfully acquire real estate in San Diego using these documents, which also safeguard the lender and buyer from any potential liabilities that may arise during the acquisition.
When a title company investigates a property's history, it finds a record of every owner. This includes details on the present owner(s) and any prior owners. The title will also show any mortgages or other liens against the property, including the mortgage if you recently bought the house.
Keep in mind that a deed is not the same as a home title. One way to legally transfer home ownership is by using a house deed. You are officially recognized as the new homeowner when this paperwork is signed and witnessed at closing. The title contains a detailed description of the home to avoid any confusion about the real items being transferred on closing day.
In contrast, a home title certifies your property ownership and identifies any other "owners" or debts in reference to the property, such as liens or mortgages. After you pay off your loan on the property, the title will simply show you as the outright owner, just like a vehicle title.
Locating a local title company is an important step in closing a house purchase after you have a contract. In a mortgage, the title company is involved in multiple functions.
Verification: The company will carry out a title search to determine the whole history of ownership (also known as the chain of title). This procedure entails looking for the following items in public records that can affect the buyer's ownership rights:
Usually, before closing on the loan, the mortgage lender will ask you to fix any issues discovered by the local title company that might affect your claim to ownership.
A property survey is necessary to ensure that your building does not infringe on your neighbor's or other people's property boundaries. Depending on your location, you may be asked to complete a survey while purchasing a house. The seller may not have had one performed lately, but title companies may still need them for insurance reasons.
A property survey is not always necessary, but it's always a good idea to have one just in case you ever have problems with your neighbors.
As indicated earlier, a title business is tasked with investigating property records to generate the Title Commitment and title abstract for real estate transactions. Simply put, an abstract is a record showing who has owned a piece of property and when. A commitment is a list of things that must be done to clear a title in a transaction so that title insurance may be issued.
The Commitment will also include a list of cases when that policy is not applicable. The Title Abstract will consist of the property's history of ownership, problems with probate, lawsuits or tax sales that impact the property, and more. Reading the abstract may give you a quick rundown of the property's history.
A title business typically performs the duties of an "Escrow Officer" or "Escrow Agent" in most transactions. For the duration of the transaction and per the parties' directions, the local title company may be tasked with keeping monies (such as earnest money deposits, loan proceeds, and repair funds) or documents (such as deeds and affidavits) in escrow.
For example, to legally bind a contract, the title company will often request an earnest money deposit. The buyer or the buyer's lender may deposit the funds with the title business for safekeeping. In the case of a document escrow, for instance, a seller may, owing to availability concerns, sign the conveyance deed early to facilitate delivery upon receipt of the purchase money later. Under these circumstances, the local title company would store the papers according to the buyer's and seller's written instructions until the buyer pays the seller or until the agreement specifies otherwise.
Settlement services are another common offering from title companies. These include document preparation, a notary or real estate attorney appointment for review, and a closing schedule. After the closing, the title business will file the deed with the appropriate county official to formalize the transfer of ownership.
Title searches and property surveys may often uncover most problems, but they aren't infallible. Title to the land might still be at risk years after the purchase is finalized due to things like forged paperwork, administrative mistakes, unidentified heirs, and disagreements over property lines. Therefore, title companies provide dual insurance policies (lenders vs. owner's title insurance) to safeguard the lender's interests and protect your own.
Lenders vs. Owner's Title Insurance: A lender's or mortgagee's title insurance policy is designed to protect the mortgage lender's "first lien" or "priority lien" on the property. The buyer's mortgage will take precedence over almost all other liens since it will be in "First Lien" status. This insurance is not necessary for a cash transaction. To be sure, this coverage is required by most mortgage lenders if you want to get a loan to buy a house.
In the same way as a loan policy safeguards the lender's "First lien" status, an owner's title insurance policy protects the insured and the "vested" owner of the property. Under the terms and conditions of an owner's policy, the buyer is protected against claims of ownership or open liens that assert precedence of ownership. Lenders vs. owner's title insurance safeguards your house against future property issues since it is your most precious and important asset.
It is perceptive to compare costs and services offered by different title companies, even if your real estate agent suggests one. This will help you find the greatest deal without sacrificing quality. Here are some steps to help you locate a reliable local title company:
Referrals Are Preferred: If you have faith in your real estate agent, using their recommended title business could save you time. If that doesn't work, you may consult the people closest to you for advice based on their experiences.
Do Online Research: Look for title companies online before contacting one. Read reviews written by actual customers to get a feel for the quality.
Ask Around and the Company: Inquire about the services they provide, the steps they take to find a title, their fees, and the measures they take to ensure the security of your money when you are ready to contact title companies.
Ownership Verification: Also, check whether they are a local business with expertise in your region or part of a larger national chain that uses third parties. Real estate businesses or lenders own some title companies, so they must remain impartial. Make sure the local title company has offices nearby, as you will probably close at one of their sites. If that is not the case, ask if there are other places they can close.
When purchasing a house, title companies play an important role in ensuring a seamless transfer of ownership of the property and all rights associated with it. The lender will probably require you to use a local title company, but you will often have some say in which one you pick. To ensure you have a pleasant experience, spend time shopping around and comparing prices, services, and everything else that matters to you.
If you’re looking for a reliable leader in San Diego to handle your property purchases, feel free to contact the Ryan Lipsey Team from Ticor Title. As the biggest titling company in San Diego, Ticor Title Company of California can aid with all types of real estate transactions. We can be the best option if you’re a business looking for a partner to handle your real estate insurance. Contact us to know more.
RYAN LIPSEY TEAM