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Planning To Buy Or Sell Your Home? Here’s How Title Companies Can Help You!

August 11, 2023

Buying or selling a home isn’t as simple as buying clothes in exchange for money. Selling a property is a big deal. For most people, it is one of the biggest transactions, especially for first-time homebuyers. And when you decide to sell or buy a house, you’ll need a title company's services.

When you decide to sell a property, that’s where the title company comes in. They provide a variety of title services to handle the concerns of both the buyers and sellers about the title. 

They also make sure that the seller has the right to transfer the property to the buyer. In short, selling your house means needing the title company’s services. They will process everything you require from conducting a title search until its closing day. To know more about what title services can do to sellers, here is some helpful information. 

Attorney’s Contract

A title company will help sellers with various documents that are needed when they sell their property. This is where the lawyer comes in. They will help you to review the contract and other documents to see if they are valid. 

Most title companies have real estate lawyers, but you can always ask friends or family members for referrals.

Title Searches 

One of the main responsibilities of a title company is to conduct a title search, which is very important. But, what is a title search? 

It is a public record examination of the property’s title you are selling which also includes deeds, mortgages, liens, and other claims that could affect the property’s ownership. This ensures that what the seller sells is clear and eligible for sale. A good title search will help to sell the house and solve issues (if there are any) before the closing process.

Title Insurance

Title insurance is also important not only to buyers but also to sellers. It protects lenders, sellers, and buyers from having a financial loss or unseen defects. In most cases, defects usually don’t show up when a title search is being conducted, which is why additional protection is required. It also remains valid as long as the seller remains interested in the property. Two kinds of title insurance policies:

  • Lender’s policy – When a borrower acquires a home through a mortgage, they require this type of policy as one of the conditions. Its purpose is to safeguard the lender's interest against any title defects or issues that may affect the security of the mortgage loan. It is based on the amount of the mortgage and will decrease as the mortgage is paid off. 
  • Owner’s policy – this type of insurance policy provides coverage to the owner. This is not always required but is recommended. It is for protection and interest as a way to safeguard against future claims to the property. It will last a lifetime for the buyer as long as they have an interest in the property. 

If these are delayed, it can cause closing to be delayed. If issues arise, you should resolve them as soon as possible to avoid leading the deal to fall through. 

Paperwork Filling and Notary Services

Title companies will help the seller with the closing paperwork. They will handle all necessary documents that are relevant to government agencies, ensuring that the buyer and mortgage agency has a copy of closing documents. 

While the title company also provides notary services to the seller. 

Lien Negotiation

When you are selling a property, you need to ensure that the liens are done and paid off. 

What are liens, you ask? It is a legal claim or right made against the asset that is held as collateral to pay off a debt. This process can be very complicated and sometimes hinder the closing process. This is where the title company helps to negotiate and ensure that you still get to keep most of the sales price. 

Payoff Coordination

The title company will coordinate the payoff process if the seller has an outstanding mortgage or liens on the property. This is to secure that these obligations are satisfied during the closing process. 

Document Preparation

The title company prepares all the legal documents and paperwork that is needed for sale. They make sure that all necessary documents and documentation are accurate and that it complies with the laws and regulation. 

Closing Process

Up until the closing process, the title company will help coordinate with all parties involved, confirming that they have the correct documents, that all funds and documents are properly handled and disbursed, and that the process goes smoothly. They will only give the documents once the buyer completed the conditions and payments that have been set. 

Title companies also provide settlement services like facilitating escrow, notarization of documents, or recording the deed with the county. They act as a neutral third party to assist the buyer and seller in the transaction. 

real estate agent walking in the neighborhood

Disbursement Of Funds

After everything is set and the closing is complete, the title company distributes the proceeds from the sale to the seller. The title company will deduct any outstanding amounts owed like closing costs and commissions. 

How Much Will It Cost For Title Company Services?

Title services may vary depending on where you live. The amount will depend on the kind of service you will require. The cost usually ranges from $1,000 but will not exceed $1,500. 

As mentioned above, the cost depends heavily on which state you live in and is regulated by the state’s Department Of Insurance. So even if you look for different title insurance, the cost will only be the same; however, it might also vary depending on the coverage amount you select. 

Who Pays The Title Insurance?

This will still vary on what state you live in, but for most states, the buyer is the one who pays for the title services and title insurance. Meanwhile, the closing cost can be negotiable and both the buyer and seller can discuss who will pay for the services. It can be a fifty-fifty cost or solely charged to the buyer. 

How To Choose A Title Company

Title companies can often be recommended by the buyer’s real estate agent, lender, or attorney involved in the home sale, or as mentioned above, you can also ask for referrals from a friend or a family member. 

Doing the right research and reading reviews can help you decide which title company is best to take services from. 

Asking around and knowing their rates and fees can also help you decide, but just make sure that the company you’ll choose is licensed and accredited.

If you're looking for a reliable title company in Indiana, our team at Indy Legal is here to help. Call us at 317-214-6023 or send us a message by clicking this link.

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8315 W. 10th Street
Indianapolis IN 46234

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