The process of buying a new home is often both exciting and overwhelming to many first-time property owners. Most people typically have multiple questions about this long affair, such as “how do I protect my home from damage or legal issues?” or “what fees should I expect upon closing and what is the total sum of these costs?” Fortunately, there is a specific type of business that can assist you with these concerns: a real estate settlement company.
A Real Estate Settlement Company Is There To Assist You
A real estate settlement company’s primary purpose is to help you with the closing process after you purchase your house. Depending on the organization, a real estate settlement company may only provide title insurance, or just offer escrow services, or it may supply both. Be sure to ask your real estate settlement company how it can specifically assist you.
Real Estate Settlement Company Responsibilities
A real estate settlement company that provides comprehensive assistance typically handles four specific duties. Here is a close look at these responsibilities.
Conduct A Title Search
A title search is conducted to ensure that a title (e.g. a deed) is clean and that your home may be legally sold. All issues or “defects” to a title – such as mechanics liens, easements, property restrictions, undisclosed heirs, and public record errors – should be settled prior to the sale of a home. This is the key first step toward issuing title insurance.
Take Care Of Title Transfers
A real estate settlement company does not simply carry out a title search. It also ensures that a title transfer is clean (devoid of legal issues). When you purchase a new home, many companies will typically provide you with a preliminary report to review and approve. A clear title is important because without one, you may easily face a lawsuit if someone else claims to legally own your property.
Issue Title Insurance
Once a clean title transfer has been completed, a real estate settlement company can create a title insurance policy for you. Remember that title insurance is a one-time payment – generally paid at closing – rather than a payment made on a monthly or annual basis. Title insurance is also different from other types of insurance because it protects you against incidents from the past rather than future claims.
An extended owner’s policy can protect you from additional liabilities such as forgeries, encroachments, structural damages, living trusts, and previous ownership covenant violations. Depending on the state you live in, either you or your lender (or both) may be responsible for paying title insurance. You may also be able to negotiate how much you pay in certain cases.
Provide Closing Services
A professional settlement company can act as both a closing agent and an escrow officer. If you choose an organization that is prepared to handle both of these responsibilities, this is generally a sign that you are in good hands. A home is one of the most important investments you will make in your life, and a settlement company can help you ensure that no aspect of the closing process is overlooked. Funds are placed in escrow to allow you (the homebuyer) to perform due diligence on your new investment.
In some cases, a title insurance company may also provide you with an itemized list of fees upon closing. Although this sum may be different from the total amount listed on your mortgage loan estimate, this does not necessarily signify you are being forced to pay more.
Talk To A Real Estate Settlement Company
Reach out to the professionals at Mathis Title Company in Fairfax, Virginia, for more information on the responsibilities of a real estate settlement company and how it can assist you with the closing process. Robin Mathis is an attorney with more than 30 years of experience in real estate settlement services and has performed thousands of closings, both residential and small commercial. Ann Andreatos is a title agent who has more than 14 years of experience in the title and closing industry.
Our legal backgrounds help us significantly with the process of title searches and ensuring clean title transfers. Once a title has been approved for transfer, we will contact one of our trusted underwriting companies to issue a title insurance policy. Should the validity of your title be disputed, our policies will pay for a defense attorney and even provide compensation if your case is lost. If you decide to re-sell your home within a few years, you may apply for title insurance binder coverage. This is an addition to your policy that is valid for two years.