When you’re buying a home, it seems like there are an endless series of decisions to be made. Even before you start looking for a home, you have to decide which realtor to use, which lender to secure preapproval from, and which neighborhoods to check out. And after you’ve found your perfect home — the most important choice of all — it seems as though the decisions multiply. You’ll have to make a final decision on your mortgage lender, and then select an attorney, a home inspector, and a title company. Along the way, each of these decisions will branch out into other decisions — how to handle the inspector’s report and any issues that are identified, what type of loan to secure and for what time period, and how to handle any disclosures or other reports that come your way.
All in all, it can be an exhausting process. Research has documented the phenomenon of decision fatigue, in which the quality of decisions declines as the number of decisions increases. As you get deeper into the home buying and escrow process, it’s important to know which decisions are important and which are best left to someone else, which can leave many home buyers wondering: does it really matter which title company I use? The answer is yes. The title company you choose can have an impact on how your escrow and closing process proceeds, and can become a make or break factor in your ultimate goal: getting into your new home.
What Does A Title Company Do?
The Title Search And Insurance Process
Your title company performs a number of critical functions in the homebuying process. First, the title company performs a title search on the property, ensuring that the person selling the home is actually the owner — that is, that the title the owner is passing to the buyer is clear and unencumbered. They then prepare an abstract of title and a title opinion documenting the results of this research. The title company stands behind this search, issuing a title commitment and insurance policy protecting against losses if it turns out that the seller did not in fact have clear title to the home. In a typical transaction, the title company will issue two insurance policies — one insuring the owner’s interests and one protecting the lender.
It is important to choose a trusted partner to issue these insurance policies. After all, an insurance policy is worthless if the company that issued it no longer exists. Title insurance policies are valid for as long as you or your heirs own your home, so getting it right is critical. When evaluating title insurance providers, be sure to pick a stable company that will be there even if your home stays in your family for generations.
Escrow And Closing
The title company you choose also serves as your home for the closing process, and in most cases, some or all of the escrow. Escrow is a process by which funds are held by a third party until a predetermined condition is satisfied. For example, in a home purchase, a buyer’s “earnest money” deposit may be held by a third party until the conditions in the purchase contract are satisfied. That way the seller is sure that the buyer can actually produce the funds, but the buyer doesn’t have to worry about an unscrupulous seller absconding with a deposit that ought to be returned.
Given the large sums of money that are involved in a home sale, finding an escrow agent you can trust is essential. You’ll work closely with your title company’s closing agent to get wire instructions, send deposits or other funds, and understand the closing process. In a world in which real estate wire fraud is becoming ever more common, it’s crucial to have a partner who won’t just send an email with wire instructions and disappear. Work with someone who is willing to pick up the phone, walk you through the process, and assure you that the instructions you’re receiving are legit.
Your title company also manages the closing process. At closing, you’ll sign your loan documents, transfer funds from escrow, pay any outstanding closing costs, update the deed of the house to your name, and get your keys. Closings can be a stressful time, with a lot of papers to sign and a lot riding on your ability to understand and review everything you’re signing. Working with a closing agent who can make your big day less stressful can make it easier for you to relax and understand everything that’s happening around you. Becoming a homeowner is a big deal, and it should be a smooth, memorable experience. Choosing an experienced, dedicated title company can make the difference between a difficult process and a memorable, even fun day in which you get to celebrate your new home ownership.
Your title company should be a true partner in your journey to home ownership, and who you choose to work with can make all the difference. Choose a company that has an established reputation, a passion for customer service, and who will never be too busy to answer all of your questions.
Learn More With Your Trusted Title Insurance Company
Ready to learn more about how Landtrust Title’s customer-obsessed dedication can work for you? We’re ready to answer them! Landtrust Title was established to fulfill the growing need for partnerships that provide higher service standards and growth opportunities in the title insurance and escrow services industry. At Landtrust, we’re different. We’re customer-obsessed and strive to focus on what you need from start to finish. We strive to deliver service excellence for every real estate transaction. Contact us today at [email protected] or by phone at 312.528.9210 to get answers to all of your questions.