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Ask Will: How Do I Choose a Title Company?

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This regularly-scheduled sponsored Q&A  column is written by Will Wiard, Arlington-based real estate broker, voted one of Washington’s Best Realtors of 2015 by Washingtonian. Please submit your questions via email.

Q: I’m a first-time homebuyer in Virginia getting ready to begin the house hunt. Does the seller pick a title company or can I?

A: That’s a great question. In Virginia, the purchaser can choose any title company or real estate attorney to handle their side of the closing. RESPA, the Real Estate Settlement Procedures Act, is a federal law that prohibits a seller from requiring a buyer to purchase title insurance from any particular title company. A purchaser can designate his or her own closing agent from either a title company or attorney. At the same time, a seller can elect a different attorney to handle their side of the transaction if they choose. This is often referred to as a split closing.

If the seller elects to go with a separate title company than the purchaser, it shouldn’t have an impact on the fees. In Virginia, each party is responsible for their own fees, taxes and payoffs, unless otherwise agreed to in writing. In some cases, a seller can transfer their current title insurance policy to the purchaser, which can save money at closing. It’s important to ask if this is an option early in the process.

Now that you know you know a bit more about who selects the title company, here are a few things you should consider before making your decision.

Is the company located nearby?

Look for a company that’s in a convenient location or has the ability to meet you nearby for closing is important. Proximity is key in moving the process along, both for you and the title company.

Do they have a good reputation for closing on time?

You’ll want to select a partner with a strong track record of closing on time. While meeting the closing deadline isn’t solely in the title company’s hands, they can contribute to a smooth closing or cause it to derail. Your agent should be able to give you at least three recommendations to explore. Don’t be afraid to ask friends for recommendations and consult online reviews, as well.

What are the fees?

Buyer or seller, I recommend all of my clients get an estimated HUD-1 (i.e., document that outlines all of the closing fees) from at least two title companies before making a decision. Even if the fees are the same, everyone has a different personality and business manner. This process will help you get a better sense for the company you’ll be the most comfortable working with throughout the deal.

Are they skilled managers?

One of the key responsibilities for a title company is to keep things on track. Your agent will consistently communicate with the title company and lender to ensure they are updated on any new information that is needed to close the deal. Below are just a few of the areas a title company oversees during a standard transaction:

  • Title examination
  • Survey of the property
  • Obtain figures for payoff(s)
  • Document preparation
  • Notarization documents
  • Work with lender and agent to insure a smooth transaction

Your choice of title company may be one of the most important for facilitating a smooth and timely real estate transaction.

I’m hoping readers will share any additional advice in comments.

Thank you for this week’s question. Please keep them coming to [email protected]. This is also a great place to reach me for anyone looking to buy or sell a home in the Arlington area.

The views and opinions expressed in the column are those of the author and do not necessarily reflect the views of ARLnow.com.

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