What Does a Title Company Do?

What does a title company do?

When you purchase a home, a title company will research the property to ensure that you are the rightful owner upon closing. They'll look through records for anything that might cause problems-ownership disputes, restrictions, unpaid taxes, liens, and more. Their goal is to document the chain of title and identify any issues that could become major problems down the road. Upon opening escrow, your chosen title company will immediately begin their research, and within a few days should have issued you a "Preliminary Title Report" showing you all of the docs and info you need regarding your chosen property.

 Look over the preliminary report carefully. Note any easements, special taxes and liens. In some instances home sellers may have added energy efficient appliances, solar, windows etc......... but instead of paying outright they opted for another approach which may include a lien on the property that is added to annual taxes until paid off. 

At the end of the process, the title company issues a title opinion. This is a legal document that states that the title is valid. The title opinion is part of obtaining title insurance. The insurance protects both the owner and the lender if there is a title dispute. If another party is actually the rightful owner of the home, your title insurance protects you from financial loss.

In addition to title opinions and title insurance, title companies in our area (and most of Northern California) also handle escrow accounts and distribute money to the appropriate parties at closing. They are acting as an unbiased mediator of sorts in charge of making sure all that was agreed to under the purchase contract is done before proceeding to the next step. They'll also deliver closing documents to the appropriate agencies including your agent, lender, and the county who will record the deed.

Not all title companies are created equally. When purchasing a home they can either make the process smooth and seamless, or at worse hold up the process. You should always ask your agent and friends who have recently purchased themselves whom they have used and liked the best, and see if you can write that title company into your offer. This extra step can save a headache down the road.

As always, If you have any questions feel free to call or text me. 

530.628.SOLD

Until next time,

Jennifer