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How Do Title Companies Make Their Money in 2023?

To understand how these companies make their money, you need to understand what they really do. Title companies make their money from collecting fees for their input in the sale, purchase, and transfer of homes and properties.

Most often, those fees are a percentage of the overall value of the property in question, although some are known to set standard fees for their services. These companies are known to carry out many tasks, all related to the title of a home.

A home’s titles cover every potential issue, and these will most often include outstanding liens, information regarding previous owners, in addition to how the home has changed hands over the years. A title company will generate income from making all these findings and taking part in a home’s sale, acquisition, or transfer.

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These services are billed to the client as fees, and this might be in the form of a set number or a percentage of the total value of the home. As such, clients are likely to pay fees to a title company for a wide range of services as the real estate changes hands all through the process.

A title company could also generate revenue by making available title insurance to clients; however, title insurance is optional, and clients are not mandated to purchase such insurance.

What Does a Title Company Do?

Just as was noted above, to understand how these companies make their money, you need to understand what they really do. Below are the basic things title companies do.

  1. Research

This is the very first service these businesses offer. The primary duty of a Title company is to confirm the legitimacy of your property’s title. It is the duty of the title company to run a title search. They focus on discovering things like outstanding mortgages, liens, easements, or any other kind of restrictions that would in any way impede your property.

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There have been cases where a divorce or mistake in a will negatively impacted the legitimacy of a title. If there’s any issue, your title company will discover it and help you surmount it.

  1. Safeguard Buyers and Sellers

Aside from finding all necessary details attached to the title of the property in question, these companies also act as a liaison between buyers and sellers and verify that both parties get what they expect.

Title companies will in many cases handle escrow closings, holding money and documents until stipulated conditions agreed upon by both parties are adequately met. Afterward, they will disburse the funds to the exact places they need to go.

  1. Title Insurance

Just as was noted above, a good number of title companies also provide title insurance. Title insurance is meant to cover and protect you from a loss if an issue occurs after your closing.

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Although it will vary and depend on your policy, the title insurance can also cover you from a vast array of issues that could come up. Errors, claims to ownership, liens against the property, and invalid deeds are just a few instances of risks protected by title insurance.


Title companies are known to make money in a wide range of ways. Like it was noted above, they charge to carry out a title search on the properties. Even though what they charge for this service differs, prepare to pay around $200, and $400 for a title search. They also generate good income from selling title insurance to both the lending institution and the buyer of a new home.