While nearly every real estate or mortgage transaction involves the work of title professionals, we know that many buyers and borrowers are unfamiliar with the work we do – or how it protects their interests. We’ve included answers to some of the most common questions here. If you have any other questions, please feel free to email us!

What is title?
Title is the legal term that refers to ownership of some type of property – such as a house, land, or a vehicle. Title also refers to the legal document that spells out that ownership, which is also called a certificate of title.

What is a title search?
A title search is a formal process in which a title company looks through all of the records related to a particular piece of property to verify that the person or organization selling it is in fact the legal owner (has clear title). A title search also verifies that there are no outstanding liens against the property.

What is title insurance?
Title insurance is a special kind of insurance that protects either the owner (you) or the mortgage lender in the event there is a previous problem with the title to your property that was not discovered during the title search. You make a one-time payment for title insurance when you obtain the mortgage for your home.

What is a closing?
A closing is a formal process in which title to a property is transferred from the seller to the buyer, or in which a lender obtains signatures on the documents needed to place a lien on the property and then issues the check. A title company acts as an escrow during the closing, verifying that both sides have met all of their obligations before allowing the transaction to be completed.

What is an escrow?
An escrow is basically a safe place in which money or a legal document such as a property deed can be kept while waiting for a transaction to occur. It’s not a physical location like a bank vault, but usually a legal entity like a title company or an account. One example of an escrow is the way a mortgage lender collects part of your property tax payments each month, holds on to the amount, and then makes the payment when due. Another example is the way a title company holds on to the deed of a property during closing until it verifies that both the buyer and seller have met all of their obligations.

What is a deed?
A deed is a legal document that assigns the title (or ownership) of a property to the buyer. Details of deeds are registered with the County Recorder so that tax notices and any other matters regarding the property can be handled with the legal owner.

What is a lien?
A lien is a legal claim against property that is recorded when someone borrows money by using the land as security. An example is a mortgage loan. When a lender gives you a mortgage, the lender places a lien on the property. When the mortgage is paid off, the lien is removed. If you try to sell the house before the lien is removed, the mortgage company would legally be able to block the sale until it received payment. Another type of lien may be placed on a home if the owner fails to pay for services received. For example, if the owner hires a contractor to make improvements and doesn’t pay for them, the contractor may place a lien on the house, and the contractor will have to be paid before the owner can sell.