If you’ve ever bought or sold a home, you know the closing process can feel like a whirlwind of paperwork and signatures. But have you ever wondered what goes on behind the scenes to make sure everything is ready for Closing Day? From title searches to fraud prevention, there’s a lot of work happening to ensure your new home is truly yours, free and clear.
Recently, I had the opportunity to sit down with Traci Newby, a seasoned title professional with over 25 years of experience in the real estate industry. Traci, who works with Anchor Title, shared her insights about what happens behind the scenes at title companies and what buyers and sellers need to know about title insurance, fraud prevention, and more.
What Exactly Is a Title Search?
When you go under contract on a property, the title company begins working to verify that the property is legally clear for sale. As Traci explained, the process starts with ordering a title search. This involves a deep dive into public records to uncover any claims, liens, or issues related to the property or its owners.
Title abstractors (the professionals conducting the search) examine deeds, mortgages, liens, and other documents to ensure there are no hidden problems. Once the search is complete, the title company compiles the findings into a report that becomes the foundation for the title insurance policy.
What Can Go Wrong with a Title?
Ideally, title searches come back clean, and the closing process goes off without a hitch. But as Traci shared, issues can—and often do—arise. These “clouds on title” can include:
- Ownership disputes, such as unknown heirs to an estate.
- Fraud or forgery, like fake signatures on past documents.
- Improperly recorded deeds or liens that were never resolved.
- Encroachments or easements affecting the property.
This is where title insurance comes into play, protecting buyers and lenders from unexpected claims against the property. Traci stressed the importance of having both an owner’s title policy and a lender’s policy to safeguard against these potential issues.
The Growing Threat of Real Estate Fraud
One of the most alarming trends in real estate is the rise in fraud. According to Traci, fraudsters are finding increasingly sophisticated ways to scam buyers and sellers. One common tactic involves impersonating sellers or altering wiring instructions to redirect funds.
To protect yourself, Traci recommends these tips:
- Verify wire instructions directly with your title company using a trusted phone number—not one found in an email.
- Be cautious of urgent requests for payment or changes to financial details.
- Consult your real estate agent or loan officer if something feels off.
Alabama-Specific Considerations
If you’re buying or selling property in Alabama, there are some unique considerations to keep in mind. Traci highlighted the Alabama withholding tax, which applies to non-residents selling property in the state. This tax is calculated based on the seller’s gain and can be as high as 4% for entities like LLCs.
Additionally, new federal regulations, such as the Financial Crimes Enforcement Network (FinCEN) rule going into effect in December 2025, will require even more transparency in real estate transactions. Buyers using LLCs or trusts will need to register with FinCEN and obtain an identifying number.
Why Title Companies Are Essential Partners
Traci also explained the invaluable role title companies play in resolving issues and ensuring a smooth closing process. Anchor Title, for example, not only handles title searches and insurance but also offers legal services such as setting up LLCs and trusts. Having attorneys on staff streamlines the process and resolves potential complications quickly.
A Few Final Words of Wisdom
Buying a home is more than just a financial transaction—it’s a major life milestone. As Traci reminded us, a house is more than square footage or curb appeal; it’s a place where life’s memories are made.
If you’re navigating the buying or selling process, take a moment to appreciate the dedicated professionals working behind the scenes to make your dream of homeownership a reality. And remember: whether it’s understanding title insurance, staying vigilant against fraud, or learning about unique tax rules, being informed is your best tool for success.
Looking for more real estate tips?
Looking for your dream home or need expert real estate guidance? Visit Jan’s website at CoastalHomesForYou.com for personalized advice and resources tailored to Baldwin County real estate.
Your Real Estate Mama is your go-to source for real estate wisdom with a southern twist. Catch the latest episodes wherever you listen to podcasts or visit yourrealestatemama.com.
