You’ve found the perfect home, the terms have been agreed upon, the contract has been signed, you’ve chosen a lender and applied for your loan.
Now it’s time for the title request to go to the title and closing company. Most lenders will ask if you have a preference for a particular company.
What Happens Next?
1. When a title request is received, a file is immediately opened, acknowledgement letters are mailed or e-mailed to you, your agent, your lender, the seller and the seller’s agent. These letters are to let all parties know the order has been received, who your contact at the closing company will be and the documentation that you and the seller will be required to obtain on or before the closing.
2. A Title Search will be performed and conduct a search of the Public Records to determine who owns the property, who has liens on it and if there are restrictions on how the property can be used by the owner. From this report, it is determined what is required to clear the title so that the lender will obtain an insurable interest in the property. As the purchaser, you will receive marketable title through the purchase of an Owner’s Title Policy.
3. If required by your lender, a Mortgage Survey Inspection from a licensed surveyor/engineer will be performed. When this is received it is reviewed to determine that all improvements, including buildings and fences, are within the boundary lines and there are no encroachments for set-back lines or easements.
4. A payoff of the seller’s existing mortgage will be ordered from their current lender to be collected at closing along with payment of property taxes and any other liens that may appear on the title search in order to clear the title.
5. A Commitment for Title Insurance will be prepared from information shown on the title search and fax or e-mail it to the lender for their review. The commitment will provide them with pertinent information including the current title holder, a correct legal description of the property, any and all easements and restrictions, as well as a summary of what is required to transfer title. These requirements typically include the execution of a Warranty Deed, the payoff and release of any liens or judgments, and the payment of property taxes.
6. Once your loan is approved, the lender will notify the settlement coordinator assigned to your file and will coordinate with you and your agents a convenient closing date and time. The lender will overnight or e-mail their loan closing paperwork to us and the closing company will prepare the remaining documents necessary to complete the package to be executed by all parties.
7. The day of the closing has arrived and all parties meet at a convenient location to sign the paperwork and transfer the keys. A closing associate will provide explanations of the documents you will be required to sign and will insure that all the terms of the contract have been met including all of your requirements. After all signatures have been obtained and all requirements are met, the funds for your final amount of closing costs and down payment will be collected. Net proceeds to the sellers and commissions will be disbursed and keys are turned over.
8. After the closing, the closing company disburses the remaining funds to the designated parties for the charges collected on the Settlement Statement, send the original loan closing package back to the lender, and record the appropriate documents such as the Warranty Deed and Mortgage Deed. After the documents have been recorded, we will issue Title Insurance Policies. The original Warranty Deed and Owners Title Policy will be mailed to you. The original Mortgage Deed and the Mortgage Title Policy will be sent to the lender. This completes “The Closing Process.”
A special “thank you” goes out to Theresa Wilson and the Williamson County Association of Realtors for providing this article.