Buying Step 7 : Using a Title Company to Do a Title Search/Finalize Your Financing

Title Company

You are almost at the end of your journey to home ownership!  After you and the seller have come to a mutual agreement and signed the Purchase Contract and any Counter Offers it is time to close your deal.  Closings are conducted by a title company in Arizona.  The final Purchase Contract and all Counter Offers will be sent to your title company along with the earnest money.  The escrow agent will then “open escrow”.

The Title Company will preform a title search and begin to address any title issues.  The Title Company provides owner’s title insurance that safeguards against loss from hazards and defects that already exist in the title.  This is provided for a one-time premium that basically protects your ownership.

Why Do You Need Title Insurance?

A home is usually the largest single investment that we make in a lifetime.  As you know, homeowner’s insurance protects you against loss from theft, fire or wind damage.  Title insurance, on the other hand protects you from hidden title risks and hazards that may someday threaten your financial investment in your home.  Remember, when you are purchasing a home, you are purchasing the title to that property.  That title gives you the right to occupy and use the land and all improvements.

What Does Title Insurance Protect Against?

Here are just a few of the most common hidden risks that can cause loss of title or create an encumbrance on title:
-Mistakes in recording legal documents
-Instruments executed under invalid or expired power of attorney
-False impersonation of the true owner of the property
-Forged deeds, releases or wills
-Undisclosed or missing heirs
-Fraud
-Misinterpretations of wills
-Deeds by persons of unsound mind
-Deeds by minors
-Deeds by persons supposedly single, but in fact married
-Liens for unpaid estate, inheritance, income or gift taxes

Finalize your Financing

Often the cost of real estate financing is greater than the original purchase price of a home (after including interest and closing costs).  Now that you’re offer has been accepted and there is valid title to the property you are purchasing, it is time to finalize your financing.

Your real estate agent will forward the contract to your loan officer.  Your loan officer should contact you to request any final documentation to move forward with the loan.  Don’t be afraid to ask questions and get everything in writing.  Just with a lot of things in life, getting a second opinion on financing is always a good idea.

Be prepared to submit any documentation to the lender in a timely manner.  This will help to ensure that you close on your new home in accordance to your Close of Escrow on your Purchase Contract.