A title company and escrow agent hold the keys to a smooth real estate closing—but choosing the wrong one can cost you thousands in hidden fees or delays. Your lender likely has preferred vendors, but you have the right to shop around and select your own. This checklist will help you vet candidates and avoid costly mistakes.
Why Title & Escrow Companies Matter
Title companies verify ownership history, issue title insurance, and identify liens or claims against a property. Escrow agents act as neutral third parties, holding funds and documents until all closing conditions are met. A single mistake—a missed lien, miscalculated prorations, or sloppy document handling—can derail closing or leave you liable for someone else's debt.
Check Licensing and Credentials
Before you meet with anyone, confirm they're actually licensed in your state. Title agents and escrow officers are regulated differently depending on where you live. Verify credentials through your state's real estate commission or insurance department website. Ask for proof of their errors and omissions (E&O) insurance, which should cover at least $1 million in claims. If they hesitate to provide proof, move on.
Review Fee Schedules in Writing
Title and escrow fees vary widely by region and transaction type. A typical title search and insurance policy costs $500–$1,500, while escrow fees usually run 1–2% of the sale price. Request a detailed written quote before committing. Compare line items across at least three companies—don't just look at the bottom number. Some firms bundle services (title search, title insurance, escrow, document preparation) while others itemize each step. Ask specifically about:
- Title search and examination fees
- Title insurance premiums (lender's and owner's policies)
- Escrow or closing costs
- Rush or expedited closing fees
- Wire transfer or document delivery charges
Assess Local Market Knowledge
A title company that handles 50 closings per month in your area knows your county records, local requirements, and quirky subdivision restrictions better than a national chain. Ask how many closings they complete annually in your specific county or region. Request references from recent clients (your realtor can often provide these). Confirm they understand local quirks—some counties require specific forms, unusual lien searches, or complex homeowners association requirements.
Test Their Communication
Slow or unclear communication is a red flag. Call with a question and note how quickly they respond. Do they explain closing documents in plain English or hide behind jargon? Ask them to walk you through what happens at closing—if they stumble over the timeline or can't articulate their role clearly, they may not be detail-oriented enough for your transaction.
Verify Technology and Accessibility
Modern title companies offer online portals where you can upload documents, sign e-signatures, and track closing status. Ask if they provide portal access and what happens if you need to sign documents remotely. Some states allow fully digital closings; others still require in-person signatures. Confirm they can accommodate your schedule—early morning, evening, or weekend closings aren't always available.
Red Flags to Avoid
- No written fee quote or vague pricing language
- Reluctance to provide E&O insurance proof or licensing details
- Pressure to close quickly without proper document review
- Unwillingness to explain their process or answer questions
- Customer reviews mentioning missed deadlines, title defects discovered after closing, or surprise fees
Get It in Writing
Once you've selected a company, request a formal engagement letter or service agreement that outlines fees, timeline, deliverables, and what happens if they miss a deadline. This protects both parties and gives you recourse if something goes wrong.
If you're working in a competitive market or managing multiple properties, platforms like Mercoly can help you compare and find trusted title and escrow service providers in one place, streamlining your vetting process.
Frequently Asked Questions
Q: Can I use a different title company than my lender recommends? Yes—federal law prohibits lenders from requiring you to use their preferred vendor, though they may impose reasonable quality standards on whoever you choose.
Q: What's the difference between a title search and title insurance? A title search is the investigation process to identify liens and ownership claims; title insurance protects you financially if a defect surfaces after closing.
Q: How long does a typical closing take from start to finish? Standard closings take 30–45 days, but rush closings (7–10 days) are possible at higher fees if the title company and your lender agree.
Ready to find the right title and escrow partner? Start comparing vetted providers today.