What Title Companies Do and Why Home Sellers Should Care

This Post was co-created with Ryan Phillips, Co-Owner, Associates Title Inc.

Welcome to a special edition of our blog, where we team up with title industry veteran Ryan Phillips to discuss the pivotal role of title companies in real estate transactions. With nearly three decades of experience and over 4,000 transactions under his belt, Ryan brings a wealth of knowledge that’s invaluable whether you’re a seasoned investor or a first-time home seller.

Ryan and I spent some time together on the Talking Realty Podcast, so if you want to hear the full interview, please check it out here. @taysia Can we add a from of the podcast video here?

Why Understanding Title Companies Matters

As a home seller, the process can seem overwhelming, filled with jargon and complex steps that aren’t always clear. One of the most critical but often overlooked elements is the role of the title company. 

Most sellers understand that they will have to engage a title company or title attorney before the closing, but it’s not like everyone has a title company on speed dial. 

Title company services and fees can vary from a few hundred dollars to a few thousand dollars, and the service and security can range from fantastic to horrible. So what’s a seller to do? 

Today, Ryan and I aim to demystify this for you, making sure you understand why the title company is critical and how choosing the right one benefits you. We will also give you some easy ways to sort out which ones are good and which ones to avoid. 

What Does a Title Company Actually Do?

A title company plays a central role in legally transferring the property from the seller to the buyer. “Think of a title company as the hub of the transaction wheel,” says Ryan. “We ensure that the property title transfers correctly and without legal impediment, and we handle the escrow accounts that hold your transaction funds.”

Key Responsibilities Include:

  • Title Search and Clearing: Before the sale is completed, the title company does a public record search to make sure there are no liens, disputes, or legal hurdles that might hinder the sale. This is crucial for clearing the way for a smooth transaction.
  • Handling Escrow: Title companies manage the escrow account, holding and disbursing funds as needed to see that all parties meet their financial obligations at different stages of the process.
  • Closing the Transaction: The title company handles the actual exchange of documents and money, finalizes the paperwork, and usually runs the closing meeting where documents are signed.

Why Should Home Sellers Care?

No matter what, you have to have a title company or an attorney to close the deal. That means either you or someone else in the transaction is going to pick the title company. You want to make that choice. 

If you let a buyer or their agent choose the title company, you could end up costing yourself a lot of extra money and unnecessary headaches. That’s how important getting the right title company is for your closing. 

And it’s not just about the fees they charge. Title companies handle a lot of sensitive data like your personal information and your bank account numbers. They are also handling all the money in and out. They make sure the buyer’s loan or cash is there and that you get what’s coming to you. 

That means in addition to asking about the fees, which should be competitive, you need to make sure they have good service and excellent security. According to the FBI, over $1 Billion dollars is stolen from real estate closings in the US every year. Let’s keep you out of that situation. 

Choosing the Right Title Company

Ryan advises sellers to look beyond pricing alone when selecting a title company. “Service is just as important as cost,” he notes. “You want a title company that communicates effectively, handles funds securely, and has a track record of resolving any issues that might arise.”

The best time to choose a title company is before you have a buyer–maybe even before you start showings. Talk with your listing agent if you have one. If you don’t, do some research and talk to people you know who do this every day. Your banker or your friends who have recently sold can also be valuable resources. 

When all else fails, head to the internet. Bad service is nearly impossible to hide these days. You can also ask us. Since we handle hundreds of deals every year all over Ohio, there are not many title companies we don’t know. We keep a list of the good, the bad, and the ugly. My email is at the bottom of every blog post. Reach out. 

Sticking to Your Guns

Once you make your title company selection, you need to make sure everyone who makes an offer knows who you are working with so there are no surprises. Buyer agents especially love to slip in a clause to the offer paperwork saying that you agree to use “their” title company. 

This is probably the most overlooked and undervalued choice in the whole contract. We’ve seen sellers kill a deal or walk away over a $500 home warranty. The choice of the title company is far more important and should get your attention. 

When anyone makes an offer, let them know that you already have a title company and that you don’t plan on changing your mind. If they tell you that it’s “the buyer’s choice” or “customary for the buyer/agent to choose,” call BS. If it’s in a contract, it’s negotiable. So…negotiate. Don’t let them tell you otherwise. 

If they really push you, here’s your answer: “Tell you what. If the buyer agrees to pay 100% of all title and closing costs, they can choose the title company.” But even then, I’d want to know who they are choosing so we can check them out before we sign anything. 

Final Thoughts

Our goal in this collaboration is to highlight the importance of understanding the role of your title company in the real estate process. As Ryan puts it, “The right title company doesn’t just process transactions; it gives you peace of mind and ensures the successful sale of your property.”

People should listen to Ryan. He’s really smart, and he’s only done this about 4000 times. I’ve worked with Ryan many times over the years, and he’s not just blowing smoke. He and his team really do care, and they go out of their way to make sure everyone in the deal gets the best service possible for the smoothest closing possible. 

Hey…have I ever steered you wrong? 

If you live in Ohio and you would like a detailed custom “Seller Net” sheet and title company recommendations, head over here and ask for it. It’s free and we do this multiple times every day. Knowing what your property will sell for is one thing–knowing what you’ll have when the dust settles after closing is another. Avoid closing-day surprises with our free estimate of closing costs, taxes, and the like. 

If you want to know a little more about our Flat Fee system, check out the videos on our “HOW IT WORKS” page, or if you want more personal advice, schedule a free call. We can answer your questions and help you put together a great plan before you sell. 

In the meantime, keep sending your questions. Your best bet is to send me a message at Glen@OhioMLSFlatFee.com. I read and respond to every email…eventually.

glen whitten ohio mls flat fee real estate broker
Ohio Property Group, LLC
Author: “You Can Sell It”
Host: Talking Realty Podcast

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