The home-buying process is one of the most exciting, yet stressful periods to happen in someone’s life. Whether you’re a first-time home buyer or have bought and sold properties before there’s a lot to consider when it comes to ensuring a smooth, successful transaction. It is important to recognize that a title company is an integral part of the home-buying process. It is also important to understand that depending on the state you live in, hiring a real estate attorney may be mandatory. If you reside in a state where it’s optional such as Arizona and Nevada, the choice is up to you. In this blog, we will examine the differences between working with a title company versus a real estate attorney.
What does a title company do?
The title company is a third party (separate from the lender, buyer, and seller) that is hired to work with the seller and the buyer on a real estate transaction. In the state of Arizona, typically the homebuyer chooses the title company, and the seller pays the premium fee. The title company’s responsibilities and services include:
- The transfer of property rights from one owner to the next and title search i.e., establishing the true owner of the property. This ensures that the property’s title is clean and clear of defects, such as liens, unknown heirs, unpaid property taxes and so forth.
- The management of escrow funds.
- Providing title insurance. This covers underlying issues with a property’s title that might have been missed before you bought the home.
- Preparing all closing documentation, including document notarization and recording the deed with the county.
What does a real estate attorney do?
In states that require the services of a real estate attorney, their role is quite similar to that of a title company. It’s most important to note that a title company cannot provide legal advice. Think of the attorney as a fact-checker and legal advisor. An attorney will review (and sometimes draft) the property’s title and the contracts between the seller and buyer to facilitate the closing process. Before the transfer of title, just like a title agency, the real estate attorney examines public records to see the history of the property and establish any defects that could negatively affect its client. Where an attorney differs from a title company is in its capacity to offer legal counsel should a dispute arise between the buyer and seller.
Who should I work with?
After looking at the differences between a title company and a real estate attorney, there are other factors to consider. Cost is the primary factor. The homebuying process is quite possibly the biggest financial undertaking in a person’s lifetime. With that said, if your state does not mandate that you hire a real estate attorney, a title company is more than capable of working out the details and will probably save you a pretty penny too. It is always best to consult with your realtor to help determine the best representation. While a realtor cannot provide legal advice, an experienced realtor can provide guidance on the best approach and resources for your specific case and transaction.
Why Landmark Title?
Landmark Title’s experience in title and escrow spans more than 45 years and our team of professionals knows how to successfully navigate complex transactions and what is needed to ensure a smooth closing that is both secure and on time. If you have any questions about our process and how we work, please get in touch. Landmark Title and its team will conduct the due diligence required to safeguard your interests.