Selling and buying real estate can be an exciting and potentially daunting process. Here are several factors to consider when navigating this process.
Partnering with an experienced and knowledgeable real estate agent is the first step to creating a seamless experience. Selecting a title and escrow company is the next key decision in successfully achieving your ultimate goal. There are several factors to consider when navigating this process.
Financial stability of the securities and escrow company
- How long has the company been in business and how likely is it to be there for you if something goes wrong with the transaction, even years later? If a title and escrow company fails, the consumer’s remedy is to resolve their ownership claim directly with their policyholder without assistance or representation. This wastes time and money, not to mention the headaches that come with it.
- Is the business financially stable enough to withstand any changes in market sentiment?
Abrupt changes in the market can quickly force a title company out of business if it lacks the experience to deal with the change. The current real estate sales cycle has been longer than any cycle in the past 50 years. It’s in your best interest to choose business partners that you know will be there to support you for decades to come.
Title and Escrow Company Management
- Who are the primary owners of the title and escrow company and do they have access to proper title research? If the company is owned by the real estate company you work with, your real estate agent may have a financial interest in encouraging the use of their affiliated business as a title and escrow company.
Both the agent and the consumer can be better protected when title and escrow services are provided by a neutral third party.
Consumer-focused certifications and warranties
- Does the company have an ALTA Best Practice certification? The American Land Title Association (ALTA) has created a set of policies and procedures that the title insurance industry should follow to protect lenders and consumers. Certification is issued to companies that have demonstrated that they meet or exceed these guidelines.
- What controls does the company have in place to protect consumer funds and mitigate losses? A reputable company will appreciate the opportunity to share with you the controls and processes they have in place to protect your funds against a host of external threats.
By design, the purpose of title and escrow companies is to function as a neutral third-party manager of funds for the real estate transaction. Today’s smartest consumer reserves the right to choose a company that has the expertise to do so, the neutrality to treat all parties equally, and the longevity to support you for the duration of your ownership. . Choose wisely!