1. Title Search: When a property is being bought or sold, the title company thoroughly examines public records to verify its ownership history. This search aims to uncover any existing liens, judgments, unpaid taxes, easements, or other encumbrances that could affect the property’s title.
2. Title Insurance: Based on the title search results, the title company issues a title insurance policy to protect the buyer and lender against any unforeseen issues that may arise with the title in the future. This policy provides financial coverage for legal fees and potential losses resulting from title defects.
3. Escrow Services: In many real estate transactions, the title company acts as the agent. They hold funds and documents in escrow until all sale conditions are met, ensuring a smooth transfer of ownership between the buyer and seller.
4. Closing Services: The title company facilitates the closing process by coordinating the finalization of all necessary documents and funds. They ensure that all parties involved sign the required paperwork and that the funds are distributed correctly.
5. Recording and Filing: The title company is responsible for recording the new deed and other relevant documents with the appropriate government agencies after the closing. This officially transfers property ownership from the seller to the buyer and ensures the transaction is legally binding.

A title company plays a crucial role in real estate transactions by assuring buyers and sellers that the property’s title is clear and accessible of any issues that could jeopardize their investment. Their services help facilitate smooth and secure transactions, giving all parties involved confidence in the legality of the transaction.