A title company is an independent party involved in a real estate transaction that is separate from the lender, the buyer, and the seller. The primary responsibility of a title company is to transfer the property rights from one owner to the next and clear the path for the process to proceed. They ensure that the homes title is clear of defects or things that could impact the buyers use of the home. Here are some of the services that a title company provides:

• Title search: A title company conducts a title search to uncover the "chain of title" - the full history of the homes ownership - and find out all title defects and encumbrances before issuing title insurance.

• Holding escrow funds: A title company holds the funds in escrow until the transaction is complete.

• Preparing documentation for closing: The title company is responsible for preparing and providing both buyers and sellers with the necessary documents.

• Negotiating: Title companies help sellers by handling all paperwork, coordinating the closing process with the buyers, and negotiating.

• Title insurance: A title company often offers title insurance to back up their title research findings, should anyone make a claim to the property in the future.

Title companies protect both buyers and sellers. They verify that the seller has the legal right to sell the property to a buyer and issue a policy called title insurance that protects homeowners and lenders from conflicts that may arise from the propertys previous owners.