Why a Title Company Is All You Need to Close Your Real Estate Deal — No Attorney Required

This was written by South Florida Title Company, which works with my broker.

Did You Know...

A question that is often asked is whether the Seller should use the buyer's title company or hire a separate attorney to prepare and review their documents. This preparation and review is basically limited to the preparation and review of the closing documents and is at a higher fee then would be charged if the "buyer's " title company were to handle the whole transaction.

At South Florida Title Associates, LLC we charge $685 to the seller as a settlement fee. This fee includes, doc prep, wire, courier, notary and scanning fees. When the Seller hires an attorney, usually at a higher cost, the buyer's title company will often add wire fees and if needed notary charges on top of the attorney's closing fee. Wire fees typically run $35 per wire and notary fees run about $100 and are on top of the attorney's closing fee.

It seems to have become the norm that Sellers or the Realtors representing the Sellers feel compelled to hire a separate attorney/company to prepare their closing documents.

I think that most Realtors and Sellers may not understand that the title company really represents the transaction, not the buyer or the seller. The title company acts as the escrow and agent and is a neutral third party whose role is to facilitate and complete the closing without "representing" either side. The role of the title company is simply to get the transaction closed and make sure all underwriting requirements are met and they are able to issue clear marketable title to the buyer and finalize the sale of the property for the seller. It is the title company issuing the title policy that will be responsible for recording the sale of the property in the public records.

What most Agents and sellers may not realize is that when another party is brought into the transaction, ( seller's attorney), the closing process becomes fragmented. Instead of everything being handled by the title company, part is handled by the seller's attorney and part is being handled by the title company. That requires extra coordination and can lead to delays in closing and additional closing mistakes.

I am going to relay a few recent examples of issues caused by different parties being responsible for different phases of the closing process.

1. Seller's attorney and title company not clear who is to order estoppel, payoffs and lien searches and they don't get ordered on time.
2. Errors in deed that is sent to title company by attorney causing delay in funding to seller. (We recently had a deed that was notarized by the listing agent which was not accepted by our underwriter.)
3. Delay in title company receiving original deed can delay funding to seller. Attorney could not deliver original until the following day as signing took place later in the day.
4. Seller payoffs must now be ordered by the title company instead of the attorney due to issues in verification of wire instructions. This can cause delays in closing if seller's attorney doesn't supply the third-party authorization to the title company.

If the whole transaction could just be handled by the party issuing the title policy, it would allow for a smoother transaction with less chances for delays and errors.

That all being said, if the Seller truly requires or wants attorney representation, not just for document preparation, then by all means they should not hesitate to hire an attorney!

It is always up to the seller to do what makes them comfortable.