Buying or selling a home has many moving parts and may be stressful. For this reason, most real estate transactions need the assistance of a mortgage title services company. Professional title services providers deal with a wide variety of related activities. However, most execute the title search and title review as one of their primary responsibilities.
Title companies are essential to the smooth closure of a real estate transaction due to their role in coordinating the various moving parts involved in purchasing and selling property. From the time a customer chooses a property until everything is finalized and the closing takes place, a good title company should be accessible to address any issues that may arise.
Many legal and financial services require getting mortgage title services, including those provided to people looking to buy homes. This article will discuss everything you need to know about mortgage title services, including the role of title services companies.
What is a mortgage title?
Title guarantees the owner the right to own, use, and dispose of real estate property. Therefore, to lawfully transfer ownership of a house, it is necessary to ascertain that the home title is without flaws and unobstructed, meaning that there are no liens or other claims to the property.
What are mortgage title services companies?
The title company acts as a neutral third party between the buyer and the seller of real estate. You employ their services to investigate and guarantee the property’s title.
If there have been any disputes about who owns a piece of land in the past, a title company can assist in clearing up the confusion and protect you. The buyer may rest easy knowing that the title company has checked the seller’s legal power to put the property on sale. Title insurance is coverage issued by a title company that protects current owners and lenders from legal disputes involving the property’s prior owners, such as title claims.
Why do you need mortgage title services?
A title search is relevant to anybody considering purchasing an established real estate since many service providers demand title reports as part of the acquisition process. Several business deals need a thorough title search report.
Say, you’ve decided to purchase a house without using a title services provider. After the purchase, you discover that the seller only owns a portion of the property since he inherited it from his late father. His brother comes knocking on your door demanding part of the house he has just acquired. Imagine the stress that would put on everyone involved.
A mortgage title services provider that does a title review of your property and provides title insurance is crucial to avoid such cases. They shield you from legal responsibility. Underwriters, title agents, lawyers, banks, asset management companies, and other government entities fall under this category.
Mortgage loans, home renovation loans, preparing a final commitment/title policy, completing home equity loans, and reviewing numerous other aspects are all examples of typical transactions in this category.
What does a title review give?
A title search may reveal much information about a property. Here are some standard details shown by a title search:
- Legal names of current owners.
- Vesting information.
- The legal description and status of the selling property.
- Identification number of the property (PIN or PID).
- The title is held if owners are joint tenants, tenants in common, or other ways.
- If there are housing liens and their details.
- Planning Acts eligibility is determined by whether or not the land is a private easement.
- Any mortgages on it
- Tax status and information
- If any payments need to be included, e.g., Homeowners’ tax, Environmental, etc.
- Transfer of ownership from the previous to the new owner
Critical roles of mortgage title services company
Having learned what a title company is and why mortgage title services are necessary, we will now explain what the critical roles of a mortgage title services company are.
1.Investigating the Chain of Title
Title companies will investigate the property’s whole “chain of title” or historical background. They also check for any liens and make sure you won’t have to discover on your own that, somehow, a contractor who did work on the property years ago and was never paid is now demanding payment from you. They will also guarantee the total amount of all property taxes.
2.Property survey and research
Your mortgage title services provider will carry out a property survey. During the closing process, surveys are conducted to verify that the property lines match precisely with the title. You may be curious as to whether your neighbor’s fence is on your land. Once the investigation is finished, the company will submit a report known as a “title abstract.” Before you close the house, you and your lender will have the opportunity to see a copy.
3.Title Insurance Policy
You, the buyer, and your lender may each have separate title insurance policies from the same title company. If someone comes up with a claiming the property that was overlooked in the title search, your lender will be protected financially and legally by the title insurance in the same way that you would be. Typically, the buyer receives title insurance coverage paid for by the seller, while the buyer is responsible for the cost of the lender’s policy. Title insurance, however, is paid for just once, at the time of closing, in contrast to other types of insurance that often need periodic payments to maintain coverage. Once you do that, you’ll be protected for as long as you own the house.
If you’d like to read about title insurance, check out this article: Title Insurance: What You Need To Know.
4.Determination of Title Holder
You should consult with a title company to ensure that the language on your title appropriately specifies the parties having transfer rights. Your choice of title wording may also impact how you recoup the costs of selling your house. If you are single and your name is the only one on the title, you hold the title in your name. However, things grow more complex if you’re married or reside in a community property jurisdiction. The mortgage title services can advise you on the best course of action and what the title should read.
The title company typically handles the closing of your property. The term “settlement” might be used to describe this assistance. A signing representative or real estate counsel (as required by law in a particular state) is selected to oversee the closing process and ensure that all paperwork is in order before the deed and title are transferred.
Read Important Steps Mortgage Lenders Must Keep in Mind During the Title Search Process to ensure a hassle-free title review.
Why outsource title processing?
Since all conveyance paperwork and records are considered public information, anybody with the knowledge and resources to do so may do a title review. However, besides containing a vast amount of information, the content of the papers could be more organized. It may consist of several descriptions of specific legal events written in a complex language.
Consequently, an accurate title search is one of the most important activities before the execution of a formal contract between multiple parties interested in a property. It’s also required during the escrow stage of closing.
That’s why it’s easier for businesses to outsource title processing to access the means and expertise to track down and carefully evaluate relevant documents without putting considerable time and effort into it. An expert title support service provider allows them to deliver a more informed report when the search is complete.
After mortgage title services give you a heads up on the title flaws, only then the lender, seller, and buyer may finalize the mortgage deal. This is the only way for the buyer to get a legal title unencumbered by liens or defects. This is all essential for the sale to close successfully.
Lenders, it would be best if you did thorough title searches to preserve your financial interest in the property. Outsource title processing to reliable experts in the field to avoid navigating the intricacies of title review. Expert Mortgage Assistance has the personnel and know-how to manage every aspect of the mortgage process, from ordering titles to facilitating the closing. Get in touch with us now, and let us handle all your mortgage title needs.