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Buying or selling a house is learning experience… every time you do it. States have different laws, and the norms between big cities and small towns are remarkably different. Even if you’ve purchased a home (or several) before, selling can be another story – especially if you go the FSBO route.

That said, you’re never completely on your own when selling a FSBO property. You will still need the assistance of an attorney or a title company. (And, that’s the beginning. Don’t forget about photographers, buyer’s agents, listing service providers and all those potential buyers out there.)

What Is a Title Company?

When you purchase a home (pretend you’ve paid for it entirely with cash for a moment), you receive the title to the house. This title means the house is yours; it’s just yours, and no one else can say it’s theirs.

Of course, it’s not as simple as changing the name on the title from the previous owner to you. If it were, title companies might not be needed.

To transfer the title from the seller to the buyer, the title must undergo a thorough examination. This is most often carried out by title companies (though there are exceptions).

During a title search, all of the possible records relating to the property and its previous owners must be checked to ensure that nobody else could ever lay claim to the home (or land).

While it doesn’t happen often, questions may arise, especially in the case of deceased or divorced estates.

And, the title research doesn’t just look at issues of ownership. The title company will also consider any unpaid taxes, liens, judgments, outstanding mortgages, and property disputes. Anything that could stand in the way of transferring the title from one party to another will be investigated. Only after the title company is completely satisfied will it issue a report of findings (which is a legal document), and prepare to transfer the title.

Title Companies Are Thorough 

Title companies don’t just do the research and hand over the title; they also provide title insurance. This protects the lender (and the buyer if a buyer’s policy is purchased) from any future claim to the property.

Because they have a financial stake in the accuracy of the title, no title company will want to rush the process. Because of their involvement in the transfer process, though they are an impartial party, title companies often provide escrow services too.

Indeed, representatives of title companies can complete the closing on a property – and you may work closely with this person as a FSBO seller. As the seller, it’s important to consider the title company carefully; while they can’t offer the advice of an agent, a communicative company will remind you that you’re not alone.