How much does hiring a title company cost?

Question

Is hiring a title company necessary for my first deal?

How much is hiring a title company?

Do i hire a title company when i get a deal under contract or before or when i close the deal?

Thanks.

Account Closed · Answer

It's unlikely a realtor will find you a property for 25% below market. Your best bet is "off market" properties. You will need a purchase & sale agreement, title report, escrow, disclosures, inspection, and appraisal. If you are looking for 97% financing (3% down) it is unlikely any property at 25% discount is going to meet FHA requirements. The lender will lend against the purchase price or the appraisal price whichever is lesser. If you find a $200,000 house that the seller will sell for $150,000 (25% discount) the lender will lend 97% of $150,000 (purchase price) even if it appraises for $180,000. But a house that sells for 25% discount  rarely meets requirements for a loan. Otherwise, the seller would simply place the house in the MLS for maximum coverage and sales amount.

I'm not saying that what you want to do can't be done, but it takes more expertise than you've shown so far. Perhaps what you really want to do is Subject To, Wrap or Land Contact. Do a search in the search bar and you will see all kinds of alternative purchasing methods. Maybe one of those methods will get you where you want to go.

Hope that helps.

Account Closed · Answer

When you say "first deal" it appears you may be wholesaling, then no, you don't use a real estate agent.

If you are trying to buy a rental for your own investments, then sure, there is no harm in hiring a real estate agent.

Account Closed · Answer

I agree with @Doug. If you want to do this on your own his overview is correct. Normally people have assistance going through the first couple of transactions. You can join the local AZREIA.org and meet up with about 2,000 fellow investors who can take you through all of the steps of almost any kind of transaction. It's like $20 a month with access to Title companies, escrow companies, attorneys, Hard money lenders,etc. You'd learn what you need to know.

You can call Great American Title, they have offices around the valley, and ask them their fees for a title report, and for a closing. It varies based on the amount of the sale and the type of transaction. Fees are typically split between buyer and seller but can vary depending on the agreement and type of financing. It's like saying "how much is an scoop of ice cream?" Well, from which store and how big of a scoop?

Account Closed · Answer

What city & state?

Account Closed · Answer

I don't know which state you are in but if you are out west, a title company provides the title report and an escrow company will do the closing. Sometimes they are the same company. Back east an attorney may provide both the title and closing.

Once you have a contract, you contact the title company/attorney that does real estate closings and ask how they want it handled. The title company will create a title report and their escrow arm will get everybody's paperwork all sorted out and when the time comes they will get signatures. You don't have to be in the same room at the same time to close. It can be on different days.

Doug McVinua · Answer

Account Closed, Of course, I could be biased regarding such a question!! lol

I don't know for sure what you are trying to accomplish in Phoenix? The dialogue hasn't really answered some key questions that would enable a higher quality answer, Jack. Happy to consult with you and provide some direction at no charge or obligation.

Doug McVinua · Answer

Account Closed Typically in Phoenix, AZ the Seller does not receive money directly from a buyer up front. The parties enter into an agreement (contract), the agreement is delivered to an Escrow Co with Earnest money, Escrow opens, Escrow does the Title research, Tax Research etc, collects all signatures, collects all funds and once Escrow has all the above they can be set to record the documents to transfer title. This is a high-level overview and a bunch of other small steps is also in the mix.

Your line of questions would indicate to me you should connect with someone that has more experience in this avenue. Sorry for a bit of tough love but some of your thoughts could lead to some expensive lessons. I might be completely off base and you are undeserving of this tough love if so I apologize.

Account Closed · Answer

The question is "why would someone sell their house for a 25% discount?"

My experience is that it means they can't sell it for 100%.

And that means it either needs a roof, or it has other deficiencies that have to be resolved before FHA requirements are met.

If it meets FHA requirements they can sell it for what ever amount they choose and FHA will lend against the lesser of the sales price or the appraisal. It's just the way they have the rules for it to qualify for an FHA loan.

How much does hiring a title company cost?

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