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Trust Title Home :: FAQs
Questions & Answers
Q. What do title companies do? And why do I need one?
A. A title company, also called a settlement company, manages and coordinates all the details of your real estate closing be it a sale, a 1031 exchange, or refinancing. For realtors and mortgage lenders we coordinate inspections and surveys, issue title insurance, handle document processing, and handle settlements, also known as closings. For the buyer and/or seller, we take care of all the details and then provide them to you in a clear and easily understandable manner.
Q. What are the specific details involved in a closing?
A. Appraisals, title searches, surveys, on-site inspections, document processing and preparation, attorney review, title policies, mortgage and lien payoffs, recording with courts, escrowing and overall quality review. At Trust Title, we do all of these items and make sure it's presented at a time convenient to you and the other parties in the real estate transaction.
Q. What documents are needed for a settlement?
A. We'll let you know the specifics for your closing but in most instances you'll need to provide:
For a Sale:- Payoff information
- Funds required at closing
- Buyers must provide a copy of the sales contract and related written materials
For a Refinance:- A copy of your owner's title policy if you have purchased the property in the last 10 years (with a copy issued in the past 10 years, Trust Title can save you costs for lender's title insurance required by your new lender).
- The most recent tax and water bills
- Your survey and a statement for your existing mortgage(s) that will be paid
- Copies of statements from which proceeds will be used to pay.
Q. What is title insurance and do I really need it?
A. Title insurance is a safeguard against loss due to unknown title defects on your property. There are two types of policies; one to protect the lender's interests for the amount of the loan and another for the buyer to protect the down payment amount. The insurance is a protection from the hidden risks that could threaten a title even after the most careful title search. The list of such risks is a long one but includes fraud, false impersonation, forgery, undisclosed or missing heirs, mistakes in recording legal documents as well as misinterpretations of wills and certain deeds that are invalid or have been misrepresented.
Q. What happens at closing?
A. You will meet with a closing agent who will review with you a series of documents that have been prepared by your lender and provided to the closing agent the day of or before your closing. Many of the documents are non-binding notices and disclosures, which can be quickly reviewed and signed. But a few are key and legally binding. At Trust Title these documents will be presented to you at the beginning of the process for your careful review. Here is a list of these documents.
- HUD-1 Settlement Statement
- Note
- Deed
- Sales/Broker Commission
- Items Payable in Connection with Loan/Fees, Points, Reports, etc.
- Items required by Lender to be Paid/Prepayments
- Reserves Deposited with Lender/Escrows
- Title Fees & Costs
- Government Recording and Transfer Charges
- Miscellaneous Settlement Charges & Fees
Q. Who chooses the settlement company?
A. The person refinancing or purchasing a property selects the closing agent. Sometimes homebuilders or lenders suggest an affiliated firm and offer to pay associated fees for using that company. But it's always a matter of choice.
Q. Who does the settlement company represent?
A. The closing agent represents all parties in a transaction: the buyer, seller and lender. In essence, the agent represents the process and/or transaction and ensures that all elements and terms are met.
Q. How much does a settlement cost?
A. The total varies for every transaction based on a variety of fixed fees and costs along with some non-variable costs. That said, here is a list of items that will be included in most settlements: Settlement/closing fee; title search/abstract fee; title insurance premium; title insurance binder fee; survey fee; delivery services; notary fee; document preparation fee.
Q. Can't closings be simplified with the use of computers?
A. The process is more accurate, timely and secure than ever thanks to advanced technologies. At Trust Title we offer digital preparation, delivery and storage of closing documents. Our advanced document management system is accurate, flexible, efficient and immediate. We also are capable offer high-volume electronic documentation. Alas, at the end of the day it is still necessary to meet for around an hour to review and sign the documents.
For more information about title insurance, see Chicago Title's FAQ page. For more information about 1031 tax deferred exchanges, visit the FAQ page at landam.com.
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