How Does Real Estate Title Work?
Title work is an important piece of the puzzle when purchasing a home as well as selling a home. As the seller you want to make sure that the title is transferred and out of your name see no longer have any obligation. From the buyer side, you want the title work transferred properly into your name to show you is the legal owner of the property.
All of this is done by your title company. There are several different people that are involved in this from researching to the actual person who does the closing. In addition you also pay for an owners policy. What that does is it protects you in the future from any mistakes that may have been made by previous title companies when the home is sold and closed. If you ever end up in a situation where something wasn’t documented correctly that insurance will pay to take care of any problem that could arise.
Knowing this that’s why it’s also very important that you have what they call gap coverage to. That’s the time frame from the day that the home closes to the day that the county actually records you as the new owner. That’s known as the gap. Sometimes that can take up to six or even eight weeks. See want to be covered during that time as well.
A cloud on the title is one there is an issue like mentioned above that was a mistake from a previous closing. Sometimes with a cloud on the title it can be an easy fix and cleared up rather quickly. In other cases like if the home was a foreclosure one point this could turn into a very lengthy process especially for has to go to court.
The most important thing to note is that when you hire your real estate agent and your loan officer you want to make sure that you are also hiring a good title company to protect you and minimize these potential problems.
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