Initiating the Process
Title request: the title examination process begins when a sales agreement is delivered to Penn Suburban Abstract, LLC (hereinafter “Penn Suburban”) which identifies the property and all the parties to the transaction.
- Lender Transaction – selling agent must provide lender the contact information for Penn Suburban. Lender will then send formal order request to Penn Suburban, which will include the lender’s information and a copy of the sales agreement.
- Cash transaction – selling agent must send a copy of the sales agreement to Penn Suburban to begin the process.
Title Search: Establishes the chain of title for subject property for a period of sixty (60) years.
- 1. Abstractors: Penn Suburban has abstractors stationed in each county to perform title searches and pull copies of all deeds, conveyances, mortgages, judgments, and any clouds in the chain of title. This is a very tedious process and may take a few weeks to complete.
Lien Letters: Penn Suburban will contact the local municipalities to investigate whether there are any delinquent lienable items (ie. taxes, water, sewage, etc.)
- Costs: Fees for these letters are fronted by Penn Suburban and can vary from municipality to municipality. The amount will then be charged to the seller on the settlement statement (approx. $75.00). PLEASE NOTE, it can take as long as two (2) weeks for these requests to be returned to our office, for reasons beyond our control.
- Dye Test: if required by local municipality, the seller must make arrangements to have a plumber complete the inspection and turn results into the municipality. It is only at that point, when they will release the lien letter.
- Wage Tax: If the seller is delinquent, the municipality will require the seller to make payment arrangements or for Penn Suburban to collect the amount from sellers’ proceeds at the time of closing, before releasing the lien letter.
Before the Closing
Necessary Documentation: Penn Suburban will inform each party if any special documentation is required. Such documentation may include, but is not limited to, the following:
- Death certificates: needed if one party in title is deceased.
- Inheritance Tax: proof of payment (if applicable).
- Mortgage payoffs: sellers’ account numbers and social security numbers are required to receive payoffs.
- Homeowners insurance: declaration page showing replacement coverage.
- If sellers will not be at closing: sellers must determine who will be representing them. A settlement authorization and/or power of attorney will be prepared by Penn Suburban at this time.
Review Title Search: an extensive review for any and all defects in the chain of title will be completed, including, but not limited to, the following:
- Legal Description of property.
- Status of property (PUD, HOA, is a resale certification necessary?)
- Titled Owner(s) status (including their marital status).
- Unsatisfied Liens: Open mortgages, judgments, etc.
- Child Support arrearages.
Title Commitment: If a mortgage is involved, the lender will require a detailed report of what liens are against the property.
- Lender transaction: lender will notify Penn Suburban when closing can be scheduled and what conditions are still open.
- Cash transaction: Agents will contact Penn Suburban to schedule.
- Penn Suburban will contact each agent to see when and where they would like to have the closing. Penn Suburban will make every effort to accommodate the needs of everyone in the transaction and will not charge for traveling or after hours
Drafting of Documents: Penn Suburban typically prepares the following documents for the closing: Settlement statement, deed, affidavits, and all title insurance documents, as well as lender documents, such as mortgages, notes, etc.
Approval of Settlement Statement: Once the settlement statement has been prepared, it will be sent to the agents and lender (if applicable) for approval. The agents and lender will then contact Penn Suburban with approval or revisions, if necessary.
Funding: The funds from the lender must then be transferred into Penn Suburban’s account and verified before the closing can take place. Penn Suburban must receive wet funds in order to make disbursements to seller, agents, banks, etc.
Clearing Conditions: The lender will inform Penn Suburban that all conditions of the loan have been met or will deliver a list of conditions to be collected from the borrower at the closing.
Buyer informed of funds necessary for closing: Buyers will be given the amount needed for closing and instructed to bring a certified check made payable to themselves. Buyers must have certified funds to close, otherwise it will take a few days for their check to clear and the checks being disbursed at closing will bounce as a result.
During the Closing
Settlement Statement will be thoroughly explained and executed by all parties.
Deed will be executed by the sellers and buyers.
Mortgage Documents will be thoroughly explained and executed by the borrowers.
Title Insurance disclosures and affidavits will be executed.
Buyers’ Funds will be collected.
Proceeds will be given to sellers in check form.
Commission Checks will made payable to broker and given to agents.
Copies of all documents will be given to buyer and seller.
After the Closing
Recordings: Deed, mortgage, and assignments will be recorded at the county.
Disbursements: Checks will be disbursed to remove all liens and pay all parties owed money from transaction.
Loan packages: will be delivered to the mortgage broker and/or investor.
Title policy: will be sent the buyer and lender.