Title search? The most important step in the real estate closing process
Those pesky charges may seem overstated to real estate buyers. However, no step in the real estate process is more designed to protect and empower buyers than the title search. What does a title search actually do? It searches the chain of ownership to look for “defects in title” that can negatively affect a new owner and in some cases make the new ownership not valid. Though not a common scenario, the safeguards for buyers are firmly in in place and a title company is committed to only thing: Clear title for the new buyer.
What does a title company do to ensure clean title? The title insurance company handles the settlement, title examination and escrow funds in a real estate transaction. They also act as the central point for buyers, sellers, attorneys, new and old lenders, realtors, insurance company, condominium/HOA association and the surveyor.
Here are some of the high level, licensed professional services that a title company performs for a buyer and seller:
- Order title search
- Title examination by Attorney or Licensed Title Agent
- Prepare title insurance commitment and comply with all requirements to ensure buyer clean title
- Tax search
- Order mortgage payoffs for open mortgages and all liens
- Request Homeowner/Condominium Association sample condo estoppel letter for maintenance fees, special assessments and litigation inquiry
- Check for municipal lien search, code violations and open permits (i.e. Miami Dade, City of Coral Gables or City of Miami Beach, Florida)
- Coordinate the loan closing and title insurance for the new lender
- Prepare all legal documents, e.g. loan documents, affidavits, power of attorney, bill of sale, deeds, corporation resolutions and/or FIRPTA documentation
- Prepare the sample Closing Disclosure Form or sample-HUD1-Florida(this closing statement form now used only for cash transactions)
- Pay off open mortgages, liens, judgments and HOA dues as part of the settlement process
- Payoff and prorate all property taxes
- Conduct the physical closing with all parties to the transaction
- Disburse closing funds and pay off all parties
- Record the deed and mortgage and all other necessary documents with the Clerk of the Court
- Issue owner’s and lender’s title insurance policy (approximately 8-12 weeks after closing)
Here are some title fees explained:
Settlement: The fee a title company charges for professional services.
Title search/abstract: Examination to verify legal ownership of property using publicly recorded documents.
Title insurance: A one-time fee at closing insuring the homeowner and /or the lender that the property is free and clear of judgments, liens, and any other encumbrances or claims to its value.
Document preparation: Preparing affidavits, deeds, continuous marriage affidavits, purchase and refinance documents including power of attorney and other documents related to title insurance.
Seller’s documents: The legally compliant preparation of documents on behalf of the seller to transfer a property. These documents include a warranty deed, bill of sale, compliance agreement, CMA and non-identity affidavits, etc.
Attorney fee: Attorney specific services on a per client basis. Fees must be approved by buyer or seller in advance.
Lien search: Review of public records at the municipal level for open permits, code violations and municipal liens.
Courier and shipping: Courier/FedEx costs for closing documents. Documents being sent via courier or FedEx include payoff of mortgages, recording of deeds, condo fees and other time sensitive documents.Wire fee: Bank charges for incoming and outgoing wires for loan payoffs, seller proceeds and creditor payments.
Archive/scanning fee: Electronic storage fee of all closing documents as required by state law.
Please call us at 305-271-0100 or info@theclosingcompany.net for more information.
