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When a title company is contacted to facilitate the closing for a property transaction, there is a great deal of information that they must gather in order to accurately allocate all monies and ensure that the documents reflect the most current, up to date and accurate information.
One of the first things we do here at Cumberland Title is send out a questionnaire to both the buyer and seller, as well as to each realtor. The information on each document asks for vital information that is required by the title company in order for them to accurately and expeditiously prepare the lengthy package of closing documents.
For example, some of the information asked on the seller’s questionnaire is whether they have any mortgages, loans, etc. that they are looking to pay off with the sale of the property. For obvious reasons, the title company needs to know this information. In the event that an existing mortgage is going to be paid off with part of the proceeds, the title company needs to know who holds the mortgage and the account number associated with this, as well as the seller’s signatures and social security numbers. Without this information, the title company is unable to order a “payoff” for the existing loan. Also worth mentioning, when a payoff is ordered, it can sometimes take up to a week to receive the requested information back, so having this information from the seller as far in advance as possible helps to prevent things like a closing being held up or pushed back simply because we didn’t receive the payoff figures in time, or the sellers had another loan to payoff that they never disclosed because they didn’t return the questionnaire. Even if there are no outstanding loans associated with the property, it is still vital to have that questionnaire returned stating exactly that, so there are no questions and time isn’t spent trying to follow up with the seller or their real estate agent trying to get this information.
For buyers, again, every question asked on the form is information that is required by the title company before the final closing can happen. That includes knowing who has been chosen as the home owner’s insurance company. If you are having difficulty choosing one, perhaps your real estate agent can refer a few for you to call and check rates before you decide. Nonetheless, you will need to have this established before the closing so that your binder can be included in with the closing package.
Buyers will also be asked if they wish the Deed to be held as “joint tenants” or “tenants in common”. A quick way to differentiate between the two: if the buyers are spouses – for example – it is customary to choose “joint tenants”, that way if one of them passes away, the ownership transfers to the other surviving spouse. “Tenants in common” would be used if the buyers were business partners – for example – and if one passes, that person’s heirs/family could take over their share, versus all of it passing over to the other remaining names on the Deed.
As for the real estate agents, it is vital that we receive those questionnaires back also, as this ensures we have not only your most updated contact information so that we can keep them in the loop throughout the process, but it also ensures that the correct commission amounts get applied to the transaction so there are no unhappy people on closing day when the commission checks are handed out.
In a nutshell, the recurring theme here is “communication”. In order to ensure that the required information is transferred between parties for a smooth transaction and closing, it is vital that all of the information asked of you by the title company is given to them in a timely and accurate manner. And when in doubt, call them before just deciding not to return the form.
As always, Cumberland Title aims to make this as smooth and hassle free of a transaction as possible for all parties involved. If ever you have questions about the process itself or anything specifically on the questionnaire, please do not hesitate to reach out to us, matthew@cumberlandtitle.com or 207-899-4900.