TITLE & CLOSING SERVICES

WHAT ARE CLOSING SERVICES

In a real estate transaction, the closing represents the final stage of the deal. At closing, the seller in entitled to the purchase funds, and the buyer is entitled to ownership of the property. The closing agent/attorney acts as a intermediary to ensure that the seller and buyer simultaneously receive what they are entitled to. The closing agent/attorney is normally responsible for confirming that the seller has title to the property and ensuring the buyer receives title insurance.

WHAT IS TITLE INSURANCE

Title insurance is an indemnity contract between an insurance company and a land owner. In its simplest of terms, it provides protection from certain losses if another person claims an ownership interest in the land you purchase. The title examination process identifies potential problems with the seller's title to the property so that corrective measures can be made prior to the property changing hands. A search is done of the public records to determine if there are any outstanding interests or liens affecting the property you are purchasing. Items disclosed on the title report need to be addressed before closing or listed as an exception from coverage. The title premium is a one time fee, paid at closing and generally provides an amount of coverage up to the full cash value of the purchase price.

WHY SHOULD I GET TITLE INSURANCE

Purchasing a house can be one of the most important financial decisions a person makes in their lifetime. Before real estate changes hands it is extremely important to make sure that the sellers actually own the property and that any mortgages or debts attached to the property will be paid off at closing. Without performing such due diligence prior to closing, the buyer could end up paying the purchase price and stuck with these problems!

HOW DO I OBTAIN TITLE INSURANCE

Generally speaking, the Pennsylvania Insurance Department has allowed for two ways of obtaining title insurance on your property, under the agent/company procedure or through the approved attorney process.

Under the company/agent procedure, the title insurance and closing services are conducted by the title insurance company or through its authorized agency representative. Pennsylvania requires the agent to charge an all-inclusive rate, which covers most fees associated with closing the real estate deal; including issuing the title policy.

Under the approved attorney procedure, the title company issues the policy and the attorney conducts the closing. Under this method a smaller premium is collected by the title company and the attorney performs the closing and collects his fee.

WHAT ARE THE BENEFITS OF USING AN APPROVED ATTORNEY FOR MY CLOSING

Aside from an attorney supervising the closing, the cost of the title insurance policy in Pennsylvania can be significantly less. Feel free to contact me for a quote at: legal@djbaumlaw.com