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Realtors and Title Companies

When buying property for the first time, there’s a lot that the average future homeowner doesn’t know, and many different industries they’re going to be dealing with for the first time. Some homeowners don’t understand the process well enough to even ask the right questions. To help out, we’ve decided to tackle a question that many people looking to buy property don’t know enough to ask: how does a title company factor into my home buying plans?

Why we’re asking:

The average home-buyer in the United States is probably familiar with realtors and real estate lawyers, but many are probably less aware of the function of title companies. Yet, for many, a title company will become part of their real estate exchange, whether they are buying or selling their homes. Our real estate professionals working in the business understand the nuances and differences better than anyone, which is why we are turning to them to help find explanations that homeowners can rely on.

Professionals, share your thoughts below:

What is a title company?

What are the differences, if any, between a realtor and a title company?

Would a homeowner ever use both a realtor and a title company?

What are the pros of using a title company? The cons?

What are the pros and cons of going through a realtor?

Are there any other varieties of real estate professionals homeowners might not know about?

Landmark cases that set precedence are an essential part of the US legal system. Knowing which ones are important can help citizens understand their own legal predicaments, and maybe avoid getting into legal trouble in the first place.

Please post your answers in the comment field below!

  • Adam Kalish 03/04/14

    Realtors and Title companies perform two different functions. Realtor are there to match buyers and sellers based on what the realtor feels is the market rate for the home and what is the buyer’s purchasing power to purchase a home. A title company is there to check out the property to make sure that the buyer is not purchasing a property that is encumbered by anything that would make the purchaser liable.

    A homeowner has to use a title company to purchase a home, but does not necessarily need a realtor to purchase.

    Using a title company can tell you the whole history of a property. It protects the buyer from anyone who would have a lien against the property and come after the new homeowner for their money. The only con is that title company are not cheap.

    A realtor may have exclusive listings that they can show homebuyers. They take a lot of work out of searching for a home and narrow down listing to the specific homebuyer. However, they are not cheap either, most of the time they are paid a commission based on the purchase price of the home.

  • Charles Gallagher 03/04/14

    What is a title company?
    A title company is an entity that preforms a survey of the available public records to determine what encumbrances exist with regard to real property; such as mortgages, liens, easements, judgments and the like. In order to close a real property transaction, the buyer must be able to take clean title that contains no encumbrances which would not be extinguished at closing. The title company is not your advocate with regard the closing and they are not there to guide you through the process. They are more akin to a necessary vendor of services to close a sale. The title company will also host and conduct the closing including preparing necessary documents, preparing the closing statement, serving as an escrow agent and disbursing funds from closing to the parties. You should not rely upon any advice from a closer with regard to the legal documents you must sign at a closing. It’s always advisable to have an attorney review the documents for you.
    What are the differences, if any, between a realtor and a title company?
    A realtor is a party that assists buyers/sellers (or on the case of a transactional broker assists both) with the logistics finding properties for purchase, negotiation over terms of a purchase and additional support after the property is under contract. Some states allow realtors to prepare the Contract for Sale and Purchase, others do not. Realtors do cannot provide legal advice
    Would a homeowner ever use both a realtor and a title company?
    Yes, it is advisable to use both a realtor and a title company. They serve different purposes and both assist buyers and sellers alike.
    What are the pros of using a title company? The cons?
    The pros of using a title company relate to knowledge on the condition of the title to the real property. Banks will not finance a property unless they know the condition of the title. Additional pros to using a title company relate to their hosting and conducting the closing. There is no real drawback in using a title company, other than cost of their services.

    What are the pros and cons of going through a realtor?
    The pros of using a realtor relate to their specialized professional knowledge in finding you the right home. Additionally, they are very well versed in negotiating with the buyer/seller to get you the best deal. The only drawback to using a realtor is the expense of their commission.
    Are there any other varieties of real estate professionals homeowners might not know about?
    In addition to securing a title agent and a realtor, buyers and sellers alike should consider hiring a real estate attorney to protect their interests. Also, buyers should consider securing a property inspector, a termite inspector, and a surveyor.

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