The Texas title insurance system, set by the state government, is the nation’s most expensive. Industry lobbyists work hard to suppress any effort at reform. As Collins found out, mortgage lenders won’t fund the purchase of a home unless their interest in the property is covered by title insurance. Title companies ensure that the property’s title is clear and transferable. By providing title insurance and preparing legal documents, they offer protection and peace of mind to both buyers and lenders.
Starting a Business in Texas
You can register your business name with Texas Secretary of State for $40. To submit a registration certificate, the Secretary of State charges a fee of $300. To start a corporation in Texas:
- Name your corporation
- Appoint a registered agent
- File formation documents
- Obtain licenses and permits
You must register for state tax obligations, including sales tax, withholding tax, and unemployment tax through the Texas Division of Revenue. Depending on the business, you may need licenses or permits for certain professions or activities.
Title Companies in Texas
It is a common misunderstanding that title companies insure surveys. In fact, they use surveys as a source of information to evaluate risks and determine insurance coverage. Title insurance protects ownership permanently against claims at no cost to you. Premiums are small relative to property value, paid only once, and coverage lasts as long as you or your heirs have interest in the property.
The Role of a Title Company in Texas
The title company in Texas is usually responsible for two different roles – providing the title insurance, and acting as the escrow officer. Sometimes, different title companies can handle these two roles, but it’s almost always the same title company.
Escrow Officer Role
The title company will hold all documents or money that are part of the real estate transaction in accordance to the will of the parties.
Insurance Issuer Role
The title company may also issue what is called “title insurance”. Title insurance companies in Texas have two primary functions: holding and disbursing funds from escrow accounts, and issuing an insurance policy covering ownership of the property.
Why is My Title Search Taking So Long?
A title search will involve obtaining records from multiple sources which can delay the process if an office is slow to respond.
Do I Need a Title Company in Texas?
Texas does not require title insurance. The lender will require you to buy a Loan Policy of Title Insurance to protect their interest.
How Long Does a Wire Transfer Take After Selling a House?
The title company in Texas is usually responsible for providing title insurance and acting as the escrow officer.
Who Picks the Title Company?
It’s negotiable in the contract. If the buyer is paying for the owner’s title policy (not common in the Fort Hood area), then the buyer may insist on the title company.
Title Search
The title search is the first item a title company initiates once they get a copy of your executed contract to make sure the seller actually owns the home, free and clear. They check the following:
- Ownership verification
- Existing liens or judgments
What is a Title Company?
A title company is a key part of a real estate transaction. They research and ensure clear title by searching property records to make sure there are no existing liens or judgments on a property.
Primary Responsibility of a Title Company
The company’s primary responsibility is to overcome problems associated with the title and find a title deed to determine the seller’s ownership. They act as agents for the insurance company, buyer, seller, and other parties in a real estate transaction.
Conclusion
The title company plays a crucial role in verifying the legitimacy of property ownership and facilitating smooth real estate transactions.