On Tue, 29 Jul 2003 22:29:17 -0500, someone wrote:


What does a title company do for the money paid to it?...

This varies very widely by state. In some states, the "title company"
acts as an escrow agent, buyers and sellers might not even use
attorneys, and the parties never sit down face to face in the same
room.

In other states a "title company" only searches titles and issues
title policies through attorneys (only) who are its designated sales
agents.

There are various other combinations of services and duties.

In my state, attorneys are customarily responsible for searching and
certifying title for buyers (even if another person physically does
it). As a result, malpractice insurance for real estate attorneys is
very costly, because though there are few successful claims, they are
potentially huge.

The only claim (which lost) that I had personal knowledge of, was a
buyer who tried to sue years later, in a dispute over what effect an
easement actually had and whether their lawyer had properly disclosed
it to them. (I helped defend the lawyer being sued).

Reading the long list of pitfalls for closing attorneys is one of the
reasons I do not do closings at all (I never did many, just on
request), even though many people think it must just be easy money.
It is when it goes right, but when it doesn't the crap flies, and I
was not doing enough to be confident that it would average out
properly.

-v.