What does a title company check during the mortgage process?

During the mortgage process, a title company primarily checks the validity of the property title. This critical step ensures that the title is clear of any liens, encumbrances, or legal issues that could affect the ownership or transfer of property. By verifying the title, the title company can confirm that the seller has the legal right to sell the property and that there are no outstanding claims against it.

The title company will conduct a title search, examining public records to identify any discrepancies or claims that might hinder the sale or ownership. This process is essential for protecting both the lender and the buyer. If any issues are found, the title company typically works to resolve them before the mortgage transaction can proceed to closing.

In contrast, reviewing the borrower's credit score is usually the responsibility of the lender, while the status of home insurance and interest rate adjustments are matters typically handled by the lender as well, not the title company. Thus, the focus of the title company’s role is squarely on ensuring the security of the property title during the mortgage process.