Who Orders the Title Search: The Seller, Buyer or Real Estate Agent?

When buying or selling a home, one of the most important steps is conducting a title search. This is a process where a professional searches the public records to make sure that the seller actually owns the property and that there are no liens or other claims on it. But who orders the title search – the seller, buyer, or real estate agent? Let’s take a closer look at what this process entails and who is responsible for it.

What is a title search?

When you are buying a house, you want to make sure the person you are buying it from has the right to sell it. To do this, you can have a title search performed.

A title search is a careful examination of the official records about a property. These records include information about who owns the property and any claims or obligations that might affect it. The purpose of a title search is to make sure that the person selling the property is allowed to do so and to find out if there are any other problems with the title of the property.

A title search is usually done in order for the buyers to receive title insurance. This is optional if the buyer pays with cash. However, if there is a mortgage, the lender will require a loan title insurance that will protect their interests as long as the loan exists.

Title insurance protects the buyer and lender from financial loss if there are any problems with the title. For example, if the person selling the house does not actually own it, title insurance would cover the cost of a legal battle to prove that you are the rightful owner.

If for example, someone claims an interest in the property after the sale, title insurance would pay for a lawyer to defend the buyer’s ownership.

So who is responsible for ordering the title search?

Whoever pays for title insurance usually selects the title company and orders the title search and insurance. Most people think there is a law that determines who pays for the title insurance. In reality, this is a negotiable term in the real estate contract.

There may not be a law on who pays for title insurance but there are customs.

In Florida for example it’s customary, for the seller to pay for the owner’s title insurance and pick the title company. The buyer pays for the loan title insurance.

If the parties want to change this, they can write it into the contract.

What is the process after the contract is signed?

  • The party paying for the title insurance or their agent submits an order with a settlement agent which could be a title company or an attorney. Most title companies nowadays have order forms online, which makes it easy. The title company will need some basic information on the property, the parties involved, and their agents, and they will also need the sales contract.
  • After the order is submitted, the buyer has to deliver an earnest money deposit to the title company.
  • Title companies then either do the title search in-house or, they will outsource it to a title plant.
  • If there is a problem with the title, the title company will work with all parties to clear it.
  • The title company will also prepare the closing documents, and coordinate with the lender, real estate agents, and buyers and sellers to make sure everyone has what they need for a successful closing.

How much does a title search cost?

The average price for a title search is $200 but it can vary depending on the state and type of property residential or commercial. The process can take from a couple of hours to two weeks, but in some cases, it may take longer if there are any complications.

Can you do the title search yourself?

If you are paying cash and not ordering title insurance, you can do the title search yourself. However, there is a good chance that you may miss something. The title search is fairly inexpensive and if you have time, it’s a good idea to get a professional to do it in order to buy title insurance.

There are some circumstances when you can’t get a professional title search, for example when buying at a foreclosure auction. If that’s the case, learning how to do a title search is invaluable. Here is our article on how to do a title search in Florida.

So there you have it, a quick answer and overview of the title search ordering process.