How Does a Title Company Help in the Sale of a Home?
If you’re considering selling your home, there are some significant benefits to working with a title company, particularly in order to safeguard your property against outstanding liens or unknown judgments which, when they slip through the cracks, can not only end up cutting into your profit at closing but in some cases, prevent you from selling.
What Is a Title Company?
A title company is an unbiased intermediary that insures a transaction and protects both the buyer and the seller. In effect, the title company serves as a state regulated agent for all parties involved in the sale of a property.
They review titles which enables them to determine the correct owner or owners of the property through a comprehensive investigation in a title search. They also facilitate closings, file and record documents with the property authorities, and make sure liens are paid from closing proceeds. Each state has their own requirements for these title companies.
Below, we’ll look more specifically at some of the advantages of using a title company’s services, how funding works, and we’ll close with how Cash House Buyers has become a leader in the Real Estate market in working with sellers to cure any unknown issues with the title for a smooth process in selling their home.
Is a Title Company Right for Me?
From a buyer’s perspective, a title company has enormous value. At closing, the buyer obtains a title insurance policy which provides protection at a later date if it turns out that there are unforeseen liens or other owners not identified up front.
Likewise, from the seller’s vantage point, using a title company is beneficial because it guarantees that liens are released properly and removed from their credit history and the title.
When a warranty deed (i.e. the instrument that conveys the ownership) is executed, the buyer no longer has to worry about anything coming back in the future involving additional payment or legal action. The warranty deed guarantees that the seller holds clear title to the real estate they are selling.
Despite the best intentions of real estate agents, attorneys, and other parties involved in a property transaction, bypassing this critical step might well lead to unexpected problems down the road.
Using a reputable title company brings closure and peace of mind for both parties enabling them to move on with their lives after buying or selling a home.
How Funding Works with Title Companies
The standard transaction requires participants to sign their closing documents while the title company holds the funds in an escrow account. On the day of closing when the seller signs their documents, they can either have funds electronically wired directly to their bank account by the title company or receive a check.
In effect, the title company is the escrow agent who acts as the bank to ensure the seller’s funds are in a safe place. They also make sure that when the seller comes into sign, the documents have not prematurely been recorded with the county until the funds are in place.
Title companies are like a firewall in the process, an extra step if you will, in making sure that the transfer finalizes through proper and legal channels.
Last but not least, the title company’s attorneys prepare the closing documents in a correct manner so that they can be entered into the county records.
How Cash House Buyers Partners with Home Owners to Make Sure Their Title Is Clear
Typically, when Cash House Buyers works with a seller to buy their house, our first step is to conduct a preliminary assessment before the title company gets involved so that we can anticipate and get out ahead of any potential issues such as liens or who else may hold a percentage of ownership.
As a result, when the title company does a title search (the final step in determining what liens there are, etc.), we’re able to anticipate these items in advance by working with the seller. At this stage, we can prepare documents or complete questionnaires to ensure that the seller is legally able to sell. This assures that they realize proceeds from the sale of the property.
The second step consists of the title company coming back to us after the title commitment is handed in. Periodically they’ll say, “We’ve got this judgment or lien against this person” which is then dropped at the feet of the homeowner to figure out and resolve.
One of the many advantages of working with Cash House Buyers is that we can provide guidance to the seller in either settling or resolving that debt to avoid coming out of pocket before closing.
Please note that many outstanding debts or liens can be settled as part of the closing; as such, a seller doesn’t have to pay anything in advance. Oftentimes, due to our expertise, we’ll help the seller negotiate a reduced rate before closing to keep more money in their pocket.
In the case of any outstanding judgments, credit card liens, or child support liens, we’re able to have them removed or waived altogether, which is of tremendous monetary value. In some cases, we’re talking about liens that could potentially consume tens of thousands of dollars of the seller’s proceeds.
Helping a seller navigate through these thorny issues is something that we do as part of the home buying service.
- Debt or Lien Issues
- Elderly Homeowner
- Foreclosure Avoidance
- Landlord Solutions
- Sell With A Problem Title
- Sell Your Home As-Is
Ultimately, the objective is to control the sale so that the seller can realize their rightful proceeds at closing.
Inherited Property and Affidavits of Heirship
Over the years, Cash House Buyers has worked with numerous sellers who have inherited property they’ve wished to sell but a Last Will and Testament was not recorded or probated. One of our services is to help the seller prior to the title company’s involvement in creating the affidavits of heirship, a sworn statement or statements needed to establish ownership of the property when the original owner dies intestate.
Our in-house processing team can create the heirship documentation and will work with you and your family members to clear the way for the sale of the home.
We often find that the other family members have unsuspecting liens which can entangle all of the family members in a lengthy, unpleasant process which spoils the sale of the property for all involved. Our goal is to help you work around these issues through generally unknown channels.
Once we’ve helped determine who has a rightful ownership interest, we do our part to ensure those individuals are on board–irrespective of their location, estrangement from family, etc.–and we work with them on behalf of the family to guarantee proper documentation is executed.
If you’re currently in this situation or are worried about a lien preventing you from selling your home due to numerous heirs involved, give us a call for a complimentary consultation.
Why Use Cash House Buyers USA?
Think about this way: when people have an illness, they go to a doctor who specializes in a particular field like heart disease. Not all doctors can help you with heart problems and as we know, there are varying degrees of expertise and performance within each industry. Unfortunately, when it comes to Real Estate, many people hire a realtor, or an attorney who doesn’t specialize in this field and most realtors don’t have the first clue on how to clear title.
Clearing title is our specialty. We do it all the time in buying homes directly from homeowners without the middleman; our depth of experience in clearing titles has made us experts in this area.
If you’re looking for title information regarding a property you’re considering selling, please call us for a free consultation so we can conduct real time research on your property and particular situation. We’re happy to advise you on your best options.
Note: Cash House Buyers USA is not a law firm and does not provide legal advice, nor are we licensed realtors. We simply have over a decade of home buying experience and know what it takes to directly purchase property from homeowners.