Title Insurance and Closing Services Since 1954
Information for Buyers
Congratulations on your pending purchase of real estate. The process of buying a home can be overwhelming, but it doesn't have to be. An experienced title services company can help you through the process. At Wayne County Title Agency, Inc. we have provided real estate-related services to countless clients. We can help you as well.
The information below is provided to help you understand the overall process and relationship between the parties to this transaction, as well as any requirements we may have of you as buyer. When buying a home, you want the process to go as smoothly as possible. Here are a few helpful tips on how to make that happen, Just click on the items below for the explanation:
Any funds that you will need to bring to closing for the purchase of your property will require, "Good Funds" only. Good Funds are required under Ohio Code. Good funds are a cashier's check or a wire transfer. Should you need our wiring instructions or any further information please contact us.
All buyer(s) and their spouse(s) must bring a valid current government issued picture ID (Drivers License, passport or govement issued ID card) with you for proper identification, when you sign your documents. If you or your spouse cannot be present to sign please contact our office so we can work out other arrangements. Some lenders will require an additional ID such as your social security card. The signing of documents cannot take place if you do not have this identification with you
When the order is placed, our office will need to know the marital status of all buyer(s) in this transaction and the names of their spouses. All spouses will need to sign some documents even if they are not going to be an owner in the property. Ohio has dower(marital) rights and all spouses need to sign the mortgage and a few additional Lender documents in order to release any rights they may have in the property to the lender in case of foreclosure. If your spouse is not going to be able to attend the closing, please let us know immediately so we are aware of the situation. If we are not made of aware of the situation this could delay your closing.
Lender fees are the actual expenses that the lender incurs in the processing of your loan. These fees generally are charged for items such as origination costs, appraisal, underwriting, processing, document preparation and administrative costs, etc. The buyer should always request that the lender or mortgage broker explain all fees prior to attending the closing, as these fees may add significant costs to your closing. After an initial meeting with a mortgage professional, the borrower will receive a Good Faith Estimate (GFE) that shows an estimate of the closing costs associated with the mortgage application.
Unless the seller agrees to pay for any lender fees in the purchase sales agreement, these fees are always charged to the buyer. Generally, lender fees have been estimated to cost between 2 and 3 percent of the amount being borrowed, however the fees vary widely depending on the type of mortgage loan chosen by the borrower.
If the borrower chooses to pay Loan Discount points, this cost would be disclosed as lender fees as well. Loan Discount points (commonly just called “points”) allows a borrower to buy down the interest rate by prepaying a fixed amount to the lender at closing. When comparing mortgages, it is prudent for the borrower to ask the lender to explain how the payment of points may or may not be cost effective for the particular loan situation of the borrower.
Prepaid charges are for items related to the mortgage that the lender requires to be paid in advance at closing. Typically, prepaid items consist of daily interest due to bring you current to the first of the month; costs for mortgage insurance and hazard insurance and/or flood insurance; and initial reserve amounts needed by the lender to establish an escrow account for the payment of future insurance premiums, real estate taxes, and homeowners’ association dues.
These are miscellaneous charges that may be related to the transaction, such as the cost for a survey, or the cost for a pest inspection or well/septic inspections. Other items that the seller and buyer agree to have paid out of the settlement may also appear as additional settlement charges.
The Real Estate professionals involved in the transaction can provide additional details as to the particular closing costs that will apply to the transaction. It is recommended that the parties to the transaction discuss the closing costs with the various professionals, including the real estate agent, the lender or mortgage broker, and the title agent, prior to scheduling the closing date. This could help to avoid any unexpected financial concerns that may cause the actual settlement to be prolonged or otherwise postponed.
A homeowner fire and extended coverage insurance policy, either in an amount at least equal to the total of all new mortgages on the property or 100% of the replacement cost, will most likely be required by your lender. The lender will require you to pay for your first annual premium up front either prior to closing or at the closing to be included in your final figure. Contact your lender to confirm what they will require regarding the payment of your annual premium. You should provide this to your lender at least 1 week before closing, otherwise it can hold up your closing date.
FLOOD INSURANCE. If the premises is located within a specially designated federal flood hazard area, then flood insurance will be a mandatory requirement and you’ll be required to purchase a flood insurance policy. Your lender will notify you if this requirement pertains to you and your property before closing.
These are closing costs that are payable to the local, county, or state governmental entities and relating to the transaction. Usually the only fees applicable in Ohio are county recording fees and any transfer taxes owed for documents created in the transaction, such as the deed. Transfer tax varies by county and are based upon the sales price of the property and must be paid just prior to the recording of the deed. Closing costs may also include the actual government charges for obtaining tax, utility and other municipal certification statements.
This form is required only if a residence was built prior to 1978. The federal government requires that you disclose any knowledge of lead based paint on the premises, as well as providing to your buyer a federally published booklet regarding the potential hazards of lead in the home. This must be presented to the buyer at the time the purchase agreement is signed.
State law requires that the seller disclose their knowledge of the condition of the property to their buyers. This is a description of the property as it is known to the seller at the time of the sale. Subject to some limitations, if the seller does not provide this document to the buyer, the buyer may have a right to cancel the purchase agreement.
If you or your spouse or any other borrower will not be able to attend closing, you will need to notify us and your lender of that situation. If your lender will allow a Power of Attorney to be used in the closing for the party that will not be able to attend, you can have your own Attorney prepare the Power of Attorney according to the Lender's guidelines and our guidelines or our Attorney's office can prepare the Power of Attorney for you at standard cost.
If there is a power of attorney involved from any buyer to an Attorney in Fact, to sign on their behalf, and you already have a Power of Attorney prepared and signed, please fax or email a copy of the Power of Attorney document to our office and to your lender as soon as possible. Our office and your lender must approve the Power of Attorney prior to the closing.
We must have the original signed and notarized Power of Attorney brought to our office as soon as possible. The original Power of Attorney will have to be recorded in the county records prior to the recording of the mortgage or any other documents you as a buyer would sign.
Generally speaking, most title orders come to us via the lender or realtor of either the buyer or seller, depending on which area of the state you live in. As title agent, we will commence an examination of the title of the property and order the necessary information to complete the closing. When these matters are completed and reviewed by our staff and the lender notifies us that we are okay to proceed to schedule a closing, we will notify you, either directly or via your realtor or lender who placed the title order, to arrange a day and time to close the loan.
The lender will provide to us their closing package and what’s called “closing instructions with the figures for your closing. At times the closing package and closing instructions will not be received until the same day as the closing. We will compile their figures and the title figures and closing costs and other additional amounts required according to the purchase agreement onto a HUD-1 Settlement Statement. The HUD-1 Settlement Statement will need to be preapproved by your lender before we can release any figures to you for the amount you will need to bring to closing.
We will also advise you of any funds you may need to complete the transaction. Funds for closing can only be in the form of a bank cashier's check made payable to Wayne County Title Agency, or your funds will have to be wired into Wayne County Title Agency, Inc.'s escrow account. If you will be wiring funds to us for closing, please contact us and we can email or fax our wiring instructions to you.
In addition, you and your spouse must bring a valid current government-issued picture I.D. (ie Drivers license, passport or state issued ID) with you both to closing for proper identification. We cannot close a transaction without this I.D.
Real estate title insurance is a type of insurance that guarantees ownership interest in real estate. Title Insurance eliminates and assumes risk, while other types of insurance just assume risk. The policy guarantees that the property being purchased or mortgaged is free from old liens or mortgages not released of record or not paid off and it guarantees additionally that any confusion as to rights of ownership will be resolved in favor of the party owning the real estate or the title insurance company will be liable for loss in value to the policyholder up to the policy limits.
Ohio is a buyers' choice state and the consumer can choose who will provide them with Title related services. The buyer or borrower is not required to use a title company selected by someone else. If the realtor or lender has offered to prepare a title insurance application, the buyer can direct the realtor or lender to place the title order with Wayne County Title Agency, Inc..
Title insurance rates are approved by the state of Ohio, and there is no difference in insurance rates between agents. The buyer or borrower will typically want to choose a title company based on their quality of service and their ability to make the closing happen timely.
Title company fees consist of the charges to coordinate the closing and to provide title insurance. The charge for Title Insurance Premium is based on a rate schedule for the greatest amount of coverage provided on a Lenders or Owners policy. Additional fees can include Title Examination/Search Fees, Title Commitment fees, and additional coverage endorsements (based on filed rates with the State of Ohio)
A buyer purchasing real estate is offered the opportunity to purchase an owner's policy of title insurance by Wayne County Title Agency, Inc. If you are obtaining a mortgage to help you finance the purchase from a bank or mortgage company, that institution will require an examination of the title to the property and have the party reviewing the title issue to them a lender's policy of title insurance which insures the lender's security interest against loss due to defects in the title that were not discovered at the time of sale or the time of refinance. A loan policy offers no protection for the homeowner.
Since the settlement agent, attorney, escrow agent or title agent is already issuing a lender's policy of title insurance, the buyer has the opportunity at that time to obtain an owner's policy of title insurance at a cost substantially less than the buyer would pay if the policy was not written simultaneously with the lender's policy.
The owner's policy of title insurance insures that the owner has good marketable title to the property free of any encumbrances or liens that would adversely affect the property, except those made known to the buyer, and insures to the owner that if any such liens, encumbrances, defects or other title problems(which occurred prior to the date of the policy) become known the title insurer will defend the buyer's title to the property.
In many instances we are asked whether or not title insurance is necessary or advisable for the owner to purchase. We recommend the purchase of the title insurance for some very simple reasons. First, the premium for purchase of the title insurance policy is a one-time charge. Since the purchaser is usually borrowing money to finance the purchase, the majority of the cost of the title insurance policy that the owner would receive has been paid through the premiums for the lender's policy which is required by the loan. Usually for a few hundred dollars or less, the owner can insure against a variety of problems which could occur in the future. The following items include a small example of some of the protections found in an owner's policy, but not all:
- Forged documents in the chain of title.
- Signatures of mentally incompetent persons which are unknown to the party reviewing the title.
- Signatures of minors which are unknown to the party reviewing the title.
- Deed from corporation, unauthorized under corporate bylaws or given under falsified corporate resolution.
- Deed from purported trustee, unauthorized under trust agreement.
- Mistakes or inaccuracies in recording of legal documents of title at the appropriate place or recording or registration of title.
- Deed challenged as being given under fraud, undue influence or duress.
- The handling of the recording or indexing of the recorded documents
- Undisclosed or missing heirs
- Fraud in the execution or in the handling of a transaction in the prior chain of title
- Invalid divorces or misrepresentation of marital status of the parties signing the documents
- Clerical errors in the public records
- Claims of parties unknown because their claims have not been filed in any indices of public record.
Enhanced policies exist that go well beyond these simple coverages and provide coverage for a host of issues that can affect property both prior to and after you purchase it.
Even though the buyer may be asked to pay for the lender's title insurance protection, the lender's policy of title insurance does not protect the buyer and a claim can only be made if the lender suffers a financial loss because of a title defect that adversely affects a foreclosure of the buyer's mortgage. There have been many defects in titles which could not be revealed by an examination of the public records. These defects usually arise at a time after the transaction has taken place and purchasers can suffer significant losses as a result of them. That is why owner's title insurance makes a great deal of sense.
The following information is intended only to give a brief description of the two most common ways of holding title in Ohio and is not provided for the purpose of advising how to take title. If further information is desired you should seek legal counsel from your attorney or retain an attorney for advice on these matters.
In order to properly prepare the documents we require information from you as to how you intend to take title to the real estate. The two most common ways two or more persons may hold title to real estate are: (1) TENANTS IN COMMON, and (2) JOINT TENANTS WITH RIGHT OF SURVIVORSHIP (also known as “Survivorship Tenancy.” )
- Tenants in Common:
Each owner has an undivided, fractional share of the property, the shares of which may be equal or unequal. Regardless of the size of an individual’s share, each tenant in common enjoys full ownership of his or her share, and can sell, mortgage, use, or dispose of it as a full owner. On his or her death, the tenancy passes to heirs or to those named in the tenant-in-common’s will. If partition is ordered, the property may be physically divided and a fee simple portion given to each tenant in common, or the property may be sold as a unit and the proceeds divided among the tenants in proportion to their respective shares.
- Survivorship Tenancy:
A survivorship tenancy is similar to tenancy in common, except that joint tenants have a right of survivorship. That is, when one joint tenant dies still owning his or her share, the share passes automatically to the surviving tenant(s). Thus, a survivorship tenancy cannot be transferred by will, as the nature of this form of ownership is that it automatically passes to the survivor(s). The right of survivorship also may be ended where, for example, all joint tenants transfer or convey their interest. In Ohio the right of survivorship must be specifically described in the document that creates it. The common language used in our state to create the survivorship tenancy is "for their joint lives, remainder to the survivor of them".
If you are a corporation or an LLC, we will need to confirm that you are listed as an entity and in good standing on the Ohio Secretary of State's business filings and we must see your operating agreement. We also require a resolution signed by the board or all of the members authorizing the purchase and mortgaging of the property. The resolution must authorize and state the capacity of the person that will be signing the purchase and loan documents to act on behalf of the corporation or LLC.
If this property is going to be titled into the Trustees of a trust, our office also requires a Memorandum of Trust and will need to review a copy of the trust and any amendments thereto. The Memorandum of Trust must comply with O.R.C. §5301.255. We will need an Affidavit of Trust prepared, executed, acknowledged and recorded. Your attorney can prepare the Affidavit or our attorney's office can prepare the Affidavit of Trust for you at standard cost. The signed original Trust Affidavit will need to be filed in the County records prior to any mortgage.
Make sure that you notify the appropriate utility companies that you are moving so they can transfer the utilities into your name and out of the seller's name. Be sure to coordinate the transfer of the utilities with the seller(s) so they do not shut off the services.
TO: Our title insurance customers and our closing/settlement services customer
NOTE: If you receive this notice as the legal representative of the consumer, you are instructed to give this notice to the consumer.
- We collect nonpublic personal information about you from the following sources: Information we receive from you, such as your name, address, telephone number, or social security number; Information about your transactions with us, our affiliates, or others. We receive this information from your lender, attorney, real estate broker, etc.; and Information from public records.
- We do not disclose any nonpublic personal information about our customers or former customers to anyone, except as permitted by law.
- We restrict access to nonpublic personal information about you to those employees who need to know that information to provide the products or services requested by you or your lender.
- We maintain physical, electronic, and procedural safeguards that comply with appropriate federal and state regulations.