The Title Insurance Process
Here's a brief outline of the basic steps in the title insurance process:
1. Initial Request for Title Insurance
A client (usually the buyer's attorney or the buyer or, in the case of a refinance, the lender) places an order for title insurance. The Title Officer can issue an initial report with the minimum of information, even without identifying the buyer or the terms of the sale. This initial response shows the title as it is presently recorded.
2. Records Search
The title officer initiates three records searches: Property, Name, and Tax searches. From that information, we create a preliminary report. Our on-site customer service center expedites the process of getting hard copies of recorded documents. Imaging helps to expedite searches by getting documents on-line.
3. Title Examination
The skill and expertise of the title officer is the key to providing the client with a useful, accurate title report. We begin the review by making a technical analysis of the documents of record. We make an interpretive analysis of all recorded matters to evaluate their impact on the title to the property.
4. Binder / Commitment (or, in NY, a Title Report)
The title underwriter issues a binder, indicating their intention to insure the title on a given property and specifying the amount of insurance, covered parties, policy terms, limitations and conditions.
5. Clearing the Clouds
The Title Officer then works to clear any clouds (i.e., encroachments) to the title. For example, if there is an unpaid judgment on the property, the title officer contacts the parties involved in an effort to get the judgment paid and clear the title.
6. Closing / Premium Payment
Unlike other insurance policies, there is a one-time only premium payment for title insurance. Generally, the premium is paid by the buyer / borrower at the closing table.
7. Policy Issued & Delivered
After the closing the insurance company issues the actual title policy. The buyer's policy is generally sent to the attorney for delivery. The lender's policy is typically sent directly to the lender.
For more information, see Title Insurance FAQs.
