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So often buyers and sellers are afraid to ask questions about the process. When I get a question more than once, I will get the answers from professionals and talk about it. So what does a title company do? Kim Cathcart from Dominion Title Services shared some great information.
When it comes to buying or selling a property, there are various professionals involved in the process to ensure a smooth and legally sound transaction. One such key player is the title company. In this blog post, we will explore the role of a title company and shed light on the important services they provide.
1. What is a Title Company?
At its core, a title company functions as an insurance company that facilitates real estate transactions. They act as a liaison between realtors, mortgage companies, buyers, and sellers. Their primary goal is to coordinate the transaction and ensure that all parties involved are protected throughout the process.
2. Conducting the Closing Process:
A significant responsibility of a title company is to conduct the closing process. Based on the purchase agreement, they gather all necessary information from the parties involved and proceed with the closing. In some states, like Indiana, closings take place at the title company itself, whereas in other states, an attorney may handle the closing.
3. Property Search and Clearing Liens:
As part of their services, title companies perform a thorough search on the property to verify its legal status. This search is conducted to ensure that there are no outstanding liens, judgments, or unpaid taxes associated with the property. Liens can arise when contractors or individuals file a claim against a property for unpaid services. Resolving any liens is crucial before the property can be sold or refinanced.
4. Compliance with the Good Funds Law:
In Indiana, there exists a Good Funds Law that governs the acceptable forms of payment for closing costs. According to this law, if a buyer needs to bring less than $10,000 to the closing, they must provide a cashier’s check. However, if the amount exceeds $10,000, a wire transfer from their bank is required. These measures ensure that the funds are guaranteed and safeguard the transaction.
5. Coordinating the Closing Process:
In Indiana, title companies provide a convenient one-stop shop for the closing process. They bring together all parties involved, including the real estate agents and possibly the mortgage company, to the closing. This allows buyers and sellers to not only sign the necessary documents but also provides an opportunity to meet and exchange information. It fosters a seamless coordination of the transaction, eliminating the need for separate closings at different locations.
Conclusion:
Understanding the role of a title company is essential when engaging in real estate transactions. These companies serve as crucial intermediaries, ensuring that the transaction is legally sound and protecting the interests of all parties involved. From coordinating the closing process to conducting property searches and clearing any liens, they play a pivotal role in facilitating successful real estate transactions.
Remember, when you embark on your real estate journey, having a reputable and experienced title company by your side can provide peace of mind and ensure a smooth and secure transaction.
