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Title Company - Roles Explained

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By : Vicki Hat    99 or more times read
The title company has a very important role in selling homes successfully and legally. Primarily, they are in charge of obtaining the chain of title. This is a form of review that reveals the ownership history of the property. Obtaining this is very important to determine if there are still existing liens against a property (as well as easements, restrictions and tax payables that you were not settled by the previous owners).

So what good will this bring to the buyer? The defects of the title will be revealed. Hence, knowing the history of the property and the past mortgage transactions could save the new owner from future litigations brought by people who have placed a lien over the property. This is also a way for them to be sure that the title to the property is clean. The findings in the title search would prove such claim.

They can also help to the transfer of title. Part of the responsibilities of the closing agent would be the recording of the deed to the Local County or court house for the purpose of making it as an official or public record. Only then the buyer could say he or she wants the house.

But that is not the only role of the title company. They can also act as the closing agent. Their primary role in here is to mediate the settlement process. They stand as the neutral third party that will ensure all fees are paid and all documents are signed. Part of their task as a closing agent would be the preparation of the HUD - 1 form to keep track of all items that needs to be settled on the final day. After that, that check that the buyer and the seller would give to settle the fees would then be safe kept and disbursed later on.

They would also issue that title insurance to the lender. Lenders want to be assured of a clean title before they invest on the borrower. Since title search are not perfect and findings can become erroneous, a title insurance would be required to protect the lender from any risks (since they are under the notion that title search may be prone to errors as well). Hence, the title company would have to issue a commitment to title insurance after performing the title search.

Legal transfer of ownership can never be accomplished without the works of the title company. One cannot simply eliminate them to save money in home buying. One thing you should know, there are many hazards to owning a home. If the transfer of rights as to property was done of forgery and the rightful owner of the house realizes the scam at the time you completed the sale, you will be in for a total loss.

It is also important that you choose a good title company to work with you. Finding them is never too hard to do. Your agents may be able to secure you with a good company that is reputable and impartial.
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