Page 14 - Butterfly Realty LLC

• Underwriting Decision-With everything reviewed, the underwriter approves or rejects the
loan. Sometimes underwriters approve the loan with conditions. For example, they might ask for
a written explanation of borrower’s credit history, such as late payments or collections.
• Lock Interest Rate-Sometime after pre approval and before closing, the interest rate for
your loan is locked. Interest rates can go up and down every day that bond markets are open for
business. You and your loan officer will choose the time to make the commitment.
• Preclosing-Title insurance is ordered before closing so that you can walk away with the keys
to your new home, ready to move in. This is also the time to make sure that all the
offer contingencies have been satisfied.

Title Company Responsibilities

Along with the binding contract being sent to the title company, also the loan documents are drawn,
meaning they are printed out, and sent to the title company (or attorney's office) where the closing
takes place. There will be a big stack of papers.

The title company also manages and protects the documentation required for the closing, which
includes the deed, title, and legal paperwork. When you are ready to close on your home, all parties
typically meet at the title company to sign the documents—under the company’s guidance—complete
final transactions, disburse funds, and transfer the title. In some states, this step is managed by a real
estate attorney or escrow agent, however, many states still use the title company as administrator for
all closing procedures.

The title company acts as the compliance officer for your home purchase or sale. They work to ensure
that every aspect of the transaction is legal and that the transfer of ownership is free of error. Their
duties consist of conducting the follow:

• Complete a Title Search- Typically the first role of a title company in a home sale is to
conduct a thorough search of the property’s history. This includes looking at all previous
transfers, owners, and liens to determine if the title is clean and available to transfer to a new
owner.
• Issue Title Insurance- The title company is to issue insurance protecting both the buyer
and the lender. Lender’s title insurance is required and is paid for by the home buyer in order to
ensure the value of the mortgage should there be any future issues with the title. This
insurance, however, does not protect your investment in the home, which is why title
companies also offer owner title policies. The owner’s title insurance, while optional in most
states, protects your own equity in the home if you ever face an unexpected issue with your
title. Both types of insurance are there to protect your investment in the face of litigation or title
fraud.
• Oversee Escrow and Closing- The title company is to oversee the closing of your home
sale and manage the escrow. The escrow account safeguards the financial transactions that are
required to complete the sale or purchase of your home, including earnest money, down
payment, and closing costs and fees.