In a burgeoning yet increasingly tricky real estate market that includes foreclosed properties, unpermitted improvements, high demand but low supply, and ever more litigious parties, it has never been more important to fully understand what the role is of your closing/title agent. Choosing the right closing/title agent is an essential part of any real estate transaction.
Unfortunately, today, the terms “title agent” and “closing agent” are used to lump together all those who issue title insurance, yet there are vast differences in skill, knowledge and diligence among these parties. The options remain the same in Florida: there are non-attorney title companies and law firms / solo practitioners that can issue title insurance and conduct closings.
Title insurance premiums are fixed in Florida by law, therefore when clients “shop” among these options, the rates for title insurance will be constant. The closing/title agent’s “closing” or “settlement” fee may vary some, but typically within a couple hundred dollars one way or the other. Other costs related to closing (e.g. title search fee) will vary some as well, but to a negligible degree. The assumption is that the law firm /attorney is more expensive and charges attorney’s fees, but these are widespread misconceptions. In many cases, the attorney title agent is actually less costly.
While the fees may vary slightly among the options available, the services provided can vary greatly. Attorneys are the only closing/title agents that are legally and ethically required to represent a party in the transaction and legally authorized to provide legal advice and legal protection. Non-attorney title companies must remain neutral between the parties, cannot represent any side, and they cannot provide legal advice. They can only conduct the closing and issue the title insurance policy. Attorneys rather, as legal advocates for their clients, will provide legal advice to their clients throughout the closing on all aspects of the transaction, the property, the contract, and the closing documents, and will do everything they can to ensure that the title being conveyed is “marketable title.” Furthermore, attorneys will timely object to title and/or survey related defects to protect Buyers’ deposits and their rights. Non-attorney title companies may point out title defects noted in the title report, but they cannot make objections on behalf of a Buyer. Additionally, they cannot provide legal advice as to options for dealing with defects, cannot provide advice as to the application of the contract terms to any particular factual situation, cannot interpret and examine a survey with the Buyer, and cannot handle disputes.
So no, all title or closing agents are not created equal.