Title
What is a title in real estate?
A title (or deed) indicates that a homeowner lawfully owns a property. Titles are clear or “clean” if the title holder legally holds the title and there are no claims against them by outside parties, such as local governments or contractors. These claims, called liens, are placed if the homeowner fails to pay bills or taxes.The lien-holder can seize the property if the liens are not paid in a certain amount of time.
Associates Title will make sure all liens or judgments are resolved before a purchase transaction is complete. The title is then protected by title insurance policies which help lenders and home buyers avoid financial losses if problems arise with the title even after the home buyer moves in.
Title search & title insurance?
Determining that a title is clear and free of liens involves conducting a title exam. We search public records looking for liens, encumbrances, and defects during the title exam.
Encumbrances occur if someone other than the owner claims an interest in the property. Defects are omissions or errors that affect the title.
Records examined may include deed records, tax records, mortgage documents, home equity lines of credit, bankruptcy filings, wills and trusts, easements, court judgments, liens, child support agreements, and divorce decrees.
Any problems identified must be cleared before we can issue the title. Clearing a title can sometimes be as simple as asking for the removal of a satisfied lien or correcting a clerical error. Clerical errors can include omitting a co-owner’s name or even misspelling a name.
Once the title is clear, the lender and buyer receive a document called a title commitment. The document outlines the terms of the title insurance, which will be issued after the closing occurs. We deliver all of our documents in a secure online portal.
What is the recording process?
Recording is the process of officially filing real estate documents—such as the deed, mortgage, or release of lien—with the county recorder’s office (or land records office). This makes the transfer of ownership and other changes to the property’s legal status part of the public record.
What is the underwriting process?
Underwriting in the title process is the evaluation and approval step where the title company reviews the history of the property to decide whether it’s safe to issue title insurance.
Funding
Earnest Money
Earnest money is a good faith deposit made by a buyer when they submit an offer on a property. It shows the seller that the buyer is serious and committed to moving forward with the purchase. The amount can vary based on the market, but it’s typically 1% to 3% of the purchase price. In competitive markets, buyers might offer more to strengthen their offer. The earnest money is usually held in an escrow account by a neutral third party—like a title company or real estate brokerage—until closing. At closing, the earnest money is applied toward the buyer’s down payment or closing costs. It's not an extra fee—just an upfront part of the total purchase amount. If a buyer backs out without a valid reason (one not protected by the contract, like financing or inspection issues), the seller may be entitled to keep the deposit. However, if the buyer cancels within the terms of the contract, they usually get the earnest money refunded.
Escrow
Escrow is a secure, neutral process where a third party—usually the title company or an escrow agent—holds funds and documents related to a real estate transaction until all conditions of the sale are met. This includes managing earnest money, loan payoffs, and contracts to ensure everything is properly handled before closing. Once all requirements are fulfilled, the escrow agent disburses the funds, records the deed, and finalizes the transfer of ownership, helping protect both the buyer and seller throughout the process.
Net to Seller?
When it comes to selling a property, the net to seller amount is the money that the seller will actually receive after deducting all applicable fees and expenses related to the sale. Obtaining a Net to Seller from different title agencies is the best way to see the price difference between each company as some fees are based on the selling price of the property. Most title agencies will provide a Net to Seller to you for free.
Non-Lien Payoff
A Non-Lien Payoff typically refers to a payment made to settle a financial obligation that is not secured by a lien on the property or asset. In real estate or mortgage transactions, this term often comes up during closings when the title company or closing agent lists all payments required to clear debts that aren’t tied directly to a lien on the property being sold or refinanced. Examples would be delinquent utility bills or seller credit card debts or personal obligations agreed to be paid at closing.
Can I use the check issued by Associates Title to initiate an ACH payment for my non-lien payoff?
No, the check provided by Associates Title cannot be used to initiate an ACH payment. ACH (Automated Clearing House) transfers are electronic transactions between specific bank accounts, and the accounts we use for real estate transactions are escrow accounts, which have strict limitations and cannot be used for ACH transfers.
Additionally, using our account information without prior authorization is considered unauthorized and may be classified as fraud. If you need assistance making a non-lien payoff, please contact us directly—we’re happy to guide you through the proper steps.
Seller Fees?
Who is responsible for each fee is mainly determined by the Purchase contract submitted. The following example is based on a typical Columbus MLS Purchase contract that defaults the cost of property tax, transfer tax, closing fees, title policies to the seller.
The fees that are take out of your selling amount include:
Brokerage and Real Estate Agent Commissions: This amount/percentage should be found on your listing agreement.
Home Warranty: if you are providing one per contract.
Property and Transfer Tax: Property taxes are paid in arrears. Taxes for the current year get added as a proration calculated by the estimated closing date.
Closing Fees: These include tile search, deed preparation and exam. These fees can vary from company to company.
Title Owners Policy: The price is based on the selling amount and will vary by the underwriter utilized.
Mortgage Pay Off: Your current lender’s website should explain how to obtain this amount. A payoff amount it not necessary the balance of the loan.
Home Owners Associations (HOAs): Some HOAs charge a fee — ranging from $0 to $500 — to obtain a HOA disclosure. From this disclosure, a proration can be calculated by the closing date. The title agency will secure and and calculate amount due prior to closing. This fee and proration are not usually available on the initial Net to Seller.
Terminology
Closing Disclosure
The Closing Disclosure (CD) is a final, detailed statement of all costs and payments involved in a real estate transaction. It outlines the buyer’s and seller’s expenses, loan terms, closing costs, and the amount needed to close. Buyers typically receive it at least three business days before closing to review and ensure everything matches what was previously agreed upon.
Deed
A deed is a legal document that transfers ownership of real estate from one party to another. It includes important details like the names of the buyer and seller, a description of the property, and the signatures of those involved. Once signed and recorded with the county, the deed becomes official proof of ownership.
Encroachment
Encroachment occurs when a structure or improvement—such as a fence, driveway, or building—extends onto someone else’s property without permission.
Small encroachment (i.e. fence):
To the buyer they are allowed to back out of the contract if they want. They need to be aware that in future a neighbor might ask for a removal or relocation of encroachment.
To the Lender, somethings small then the Lenders Policy will insure over it.
Large encroachment (i.e. garage or shed on a foundation):
To the buyer they are allowed to back out of the contract if they want. They need to be aware that in future a neighbor might ask for a removal or relocation of encroachment.
To the Lender, Overage might not be covered. Possible to do a regular Lender Policy with an exceptions. OR might stop loan from going through if encroachment is large enough.
Quitclaim Deed
A Quitclaim Deed is a legal document used to transfer whatever ownership interest a person has in a property—without making any guarantees about the title’s status. It doesn’t promise that the title is clear or even that the person transferring it owns the property. Quitclaim deeds are most commonly used between family members, in divorces, or to clear up title issues, but they offer the least protection to the new owner.
Warranty Deed
A Warranty Deed is a type of deed used in real estate that guarantees the seller holds clear title to the property and has the legal right to transfer it. It also promises that the property is free from any liens or claims, and if any issues arise, the seller is legally responsible for resolving them. This deed offers the highest level of protection to the buyer.