What a Title Company Actually Does Before Closing

You have accepted an offer and everybody keeps referring to the title company, which so far has been an email address asking for documents. Between the contract and the closing table a great deal happens that nobody explains to a seller, and most of the delays people blame on lenders actually happen here.

This article covers what the title company is actually doing, how Oklahoma differs from most states, what gets found and how it is cleared, what you sign at the end, and what a seller can do to make all of it faster.

Oklahoma does this differently

If you have bought a house in another state, expect this to feel unfamiliar.

Oklahoma is an abstract state. An abstract of title is a compiled, chronological record of everything ever filed against the parcel: deeds, mortgages, releases, judgments, liens, easements. The statutory definition sits at 1 O.S. 21(1).

That abstract is brought up to date and then examined by an attorney, who issues a written title opinion saying whether title is marketable and listing what has to be dealt with. In most states a title company searches its own records and issues a commitment. Here there is a physical document with a history in it, and an attorney's opinion on top.

No Oklahoma statute requires an abstract. Custom and your contract decide who furnishes it and who pays to update it, so read that clause.

Our article on the Oklahoma abstract of title goes through the document itself, and our page on Tulsa County title companies covers who does which part.

What they are actually doing

1. Getting the abstract updated. Everything filed since it was last brought forward is added. If nobody can find the abstract, one has to be reconstructed, which is the single commonest cause of a slow Oklahoma closing
2. Sending it for examination. An attorney reads it and issues the opinion
3. Curative work. Clearing what the opinion flags: unreleased mortgages, judgments, tax liens, probate gaps, breaks in the chain, missing signatures from decades ago
4. Ordering payoffs. Written figures with good-through dates from every lienholder
5. Preparing the settlement statement and the closing documents
6. Holding the money. Earnest money and then the purchase funds sit with them rather than with either party
7. A final update immediately before closing, the date-down, so nothing new has appeared in the meantime
8. Recording afterwards and issuing the title policy

What gets found, and how bad it is

Most of what turns up is administrative rather than serious.

Routine: a mortgage paid off years ago where the lender never recorded the release, a judgment against somebody with a similar name, an old easement nobody knew about, a misspelling in a deed from 1978. These take days rather than weeks and cost little.

Real: a lien with money attached, probate that was never completed, an heir who has to sign, a boundary problem. Our page on selling a house with title problems covers these, and our articles on selling with a lien and boundary disputes cover two of the commonest.

The important mechanic: recorded claims are paid from your proceeds at closing. You are not asked to find the money first. What they cost you is time, because a payoff figure from a slow creditor takes as long as it takes.

What actually happens at the table

The seller's part is shorter than the buyer's and mostly consists of signing.

The deed conveying the property. The settlement statement showing every figure on both sides. Affidavits about liens, possession and, where relevant, marital status, because Oklahoma homestead rules can require a spouse's signature even where they are not on the deed. Payoff authorisations. Keys, remotes, gate codes and anything else the contract lists.

Bring identification and the details of the account the funds are going to. Our article on what happens at an Oklahoma closing covers the day itself, and our page on closing costs when selling in Oklahoma covers what comes off before you are paid.

Title insurance, and the two policies people confuse

Two separate policies get issued out of the same closing and they protect different people, which is worth knowing before you agree who pays for what.

The lender's policy protects the buyer's bank, for the amount of the loan, and reduces as the loan is paid down. If a lender is involved, one is issued.

The owner's policy protects the buyer, for the purchase price. It is the one that matters to a person rather than an institution, and it is the one that occasionally does not get bought.

Neither of them protects you, the seller, after closing. What protects a seller is having disclosed properly and having cleared what the opinion flagged, which is the actual reason the curative work matters rather than a formality.

Who pays for which policy is a matter of contract and local custom rather than law, and it is negotiable like any other line on the settlement statement. Our page on closing costs when selling in Oklahoma covers where each one lands.

One point specific to an abstract state: the abstract is a physical asset with a value. Bringing it up to date costs money each time, and it is customarily handed to the buyer at closing. Whoever ends up with it should keep it somewhere findable, because the next seller will need it and reconstructing one is the delay this whole page is about.

How a seller makes it faster

• Find the abstract now. Ask whoever closed your purchase, your lender, or a safe deposit box. Reconstructing one is slow and it is the delay you can most easily avoid
• Tell them about problems before they find them. A probate that was never finished, a name change, a divorce, an old lien. Volunteering it buys weeks
• Answer the document requests the same day. Curative work waits on the slowest reply
• Get your own preliminary search early if you suspect something. Knowing in week one beats discovering in week six
• Do not sign anything about the property outside the closing without telling them. Side agreements create clouds

Where we come in

A cash sale does not skip any of this. The abstract still gets updated, the opinion still gets issued, the curative work still happens and the payoffs still get ordered. Anybody promising to close in seven days on a house with an unresolved title problem is describing something that does not exist.

What cash removes is the lender's half: the appraisal, the underwriting, the insurance condition and the loan approval timetable. That is most of the calendar in an ordinary sale, which is why cash closings are faster, but the title work is the floor and it is the same floor for everybody.

Where we are genuinely useful is a title problem that needs time. We can agree a price and wait for probate, or for a lender to record a release, without a buyer walking away and without renegotiating at the end. Our page on title problems sets out how that works.

The short version

• Oklahoma is an abstract state. A physical abstract is updated and examined by an attorney who issues a written title opinion
• No statute requires an abstract; custom and your contract decide who furnishes and updates it
• The company updates, sends for examination, does curative work, orders payoffs, prepares the settlement statement, holds the money, dates down and records
• Most findings are administrative. Unreleased mortgages and name confusions are days, not weeks
• Recorded claims come off your proceeds at closing. You do not pay first
• Oklahoma homestead rules can require a spouse's signature even where they are not on the deed
• A missing abstract is the commonest avoidable delay. Find it now
• A cash sale removes the lender's half of the timetable, not the title work