How A Real Estate Title Insurance Company Works For You

At Title Junction, we meet with many clients and handle numerous real estate closings every year.  Some of our clients are veteran homebuyers and others are going through their first property purchase.  Homebuyers and sellers alike sometimes wonder what the role of our Cape Coral title insurance agency plays in their transaction.  What services do we provide to them?  How does our work assist their transaction in going through?  And whose interests do we represent?

Investigating Properties

A real estate title agency’s services may be best described by using the words investigation and facilitation.  We investigate property histories and facilitate real estate closings.

One of the primary roles of our title agency is to conduct a derailed search of the public record for the property that is to be closed on.  This search is called a title examination or a title search.  Real estate title agencies will examine public records going as far back as the records exist to ensure that the property is unencumbered and legally available for sale.  We look for things such as back taxes owed or liens on the property and research the ownership history, survey data and property tax history.  This information is then compiled in a document called an Abstract of Title.

Facilitating Closings Through Notary And Other Services

In addition to investigating the history of the property, we also offer real estate closing services including Fort Myers escrow and notary services.  At Title Junction, we handle residential and commercial real estate transactions by conducting title searches, acting as a closing agent, escrow agent or notary, providing title insurance or even hosting outside closings at our offices.

As the closing agent, a real estate title agent will oversee the transfer of interests, ownership and funds during the closing.  The closing agent makes sure that no funds change hands until all of the necessary paperwork has been completed properly.  If our title agency is also acting as the escrow agent, they have a fiduciary responsibility to hold the buyer’s escrow payment until the closing is complete.

Protecting Your Investment With Title Insurance

Last but not least, the real estate title agency often provides title insurance for the property.  Title insurance is an indemnity policy that protects both the buyer and the lender from unforeseen claims as a result of past ownership activities.  Separate policies are issued for the owner and lender and they will protect each party from financial loss due to claims that arise as a result of title problems.  These one-time only policy purchases are paid for at closing.

Impartial Service Provider

Perhaps the greatest service a real estate title company can offer is its impartiality.  The job of the title agent is to follow the rule of law, closing instructions, transaction documentation and to generally make sure everything is in order for the sale to close successfully.  This impartiality safeguards everyone’s interest in the property and defines title agencies as a trustworthy place to do business.

What Is “Prime”?

 

The Prime Lending Rate – sometimes just called “Prime”  – is the interest rate that banks charge each other for overnight loans. Some consumer rates – like ARMs – are set in relation to Prime.

In the US, Prime is affected by the Federal Reserve lending rate to banks; historically, Prime is about 3 percent above the Fed rate.

The video shows  an example.

  • The Federal Reserve loans to Bank A at 1%
  • Bank A loans to Bank B at 4%
  • Both banks – A & B – will recalculate variable-rate loans like ARMs on that 4% Prime figure.

ARM rates are frequently defined as “% above Prime” – that gap is usually called the “margin” or “spread.” Just remember those 3 layers in Prime: Federal Reserve Bank A Bank B And finally, YOUR rate.

Closing Costs Explained Visually

 

Purchasing a home is exciting. Once escrow begins, the excitement can change to frustration, particularly if you are not ready for the closing costs that quickly accumulate.

Closing costs simply refer to the fees associated with various things associated with the escrow process in a real estate transaction. In the excitement of having an offer accepted for your dream home, you can easily lose track of the fact you are going to need to have some serious cash on hand to pay them. Many people make the mistake of only assuming they need the down payment money, and have to rush around town trying to come up with money for the closing fees.

Do yourself a favor, and discuss closing costs in advance with your real estate or mortgage person.  And watch this video to have a good mental picture of the costs that you’re likely to incur.

 

Title Insurance Explained Visually

 

What is title insurance and why should any buyer get it when purchasing a home (single family, townhouse, condo, apartment, or whatever format your home purchase takes)? Doesn’t the attorney or settlement company handling the closing see to it that you have a clear title? Isn’t this just another way for someone to siphon a few coins off a real estate transaction?

Title insurance prevents the property owner from suffering financial loss if, at any time during his ownership of the property, someone comes along who can show that they have full, or partial, ownership of the property instead.

A careful title search is done at the time property changes hands. On rare occasions mistakes are made anyway. Property can change hands in a number of ways including by deed, by will and by court action. Typically, these proceedings are recorded in different places. Searching the history of ownership to be sure nothing has fallen through the cracks is a tedious job that requires alertness, intelligence, and skill.

It is very likely that the value of your property will go up over the years. As time passes, these elements are likely to result in your home equity’s being your largest asset. Just how devastating would it be if you eventually discovered that someone else owned what you’d always thought was your home?

Do yourself a favor. When you buy a home, buy title insurance.  And watch the video to understand the essentials.