A title company makes sure that the title to a piece of real estate is legitimate and then issues title insurance for that property.
Title insurance protects the lender and/or owner against lawsuits or claims against the property that result from disputes over the title.
Title companies also often maintain escrow accounts – these contain the funds needed to close on the home – to ensure that this money is used only for settlement and closing costs, and may conduct the formal closing on the home. At the closing, a settlement agent from the title company will bring all the necessary documentation, explain it to the parties, collect closing costs and distribute monies. Finally, the title company will ensure that the new titles, deeds and other documents are filed with the appropriate entities.
WHAT IS A ‘CLOUD’ ON THE TITLE?
Clouds on titles are simply any defects such as gaps in ownership, unreleased debts, or questionable claims, typically found in public records, which might invalidate or impair ownership. – Victor Ng, Title Professional, Clear Skies Title
HOW ARE CLOSING COSTS CALCULATED?
Closing costs area combination of fees due at closing such as realtor commissions, attorney fees, title fees, lender fees, real estate taxes, utilities, fees to record documents at the courthouse, insurance, appraisals, and the costs of land surveys. – Victor Ng, Title Professional, Clear Skies Title