I sat down with William Marx, General Manager at Title WRX Agency in Royal Oak, Michigan, for a conversation that I think every buyer, seller, and real estate professional in Metro Detroit needs to hear. Title insurance is one of those things that shows up on every closing statement, yet very few people fully understand what it does, why it matters, or what’s actually happening behind the scenes between the time you go under contract and the day you get keys. We changed that.
Watch the full episode below, then keep reading for everything we covered.
What Is Title, Really?
Most people think they are buying a house. But from a legal standpoint, what you are actually buying is the right to access a piece of land, along with all the rights that come with it: the right to occupy it, improve it, and pass it on. The structure sitting on that land is secondary to the legal chain of ownership that goes back decades, sometimes more than a century.
That chain of ownership is what title is all about. And when something in that chain is broken, missing, or disputed, it can put your entire purchase at risk before you ever get to the closing table.
William explained it perfectly: while buyers fall in love with the kitchen and the bathrooms, his office is focused on something else entirely. Does this property have a clean chain of title? Is the person selling it actually authorized to do so?
That question matters more than most people realize. William shared a real example where a daughter held power of attorney for an estate and a sale was underway. The son challenged it. The title was not clean on the front end. The deal fell through. Title work is what catches those issues before they become your problem.
Title Insurance vs. What Title Companies Actually Do
There is an important distinction here that William was clear about, and it is one that gets overlooked all the time.
A title insurance policy is a product. It is the end result of all the work a title company does throughout a transaction. What title companies actually do falls into two categories:
First, they do the research and due diligence required to feel confident and compliant in issuing that policy. Second, they process the file and handle the closing documents.
Title insurance is also unique among insurance products. Your homeowner’s insurance and auto insurance protect you against things that might happen in the future. Title insurance protects you against events that already happened in the past, specifically anything in a property’s history that could surface later and threaten your ownership.
The title company works proactively to clear those issues before the policy is issued. If something slips through despite that process, the insurance is there to protect you reactively. Both functions matter.
Who Pays for Title Insurance in Michigan, and Why
In most Michigan purchase agreements, the seller is contractually responsible for purchasing the owner’s title insurance policy, which ultimately benefits the buyer. This surprises a lot of sellers who see it on their closing cost sheet and wonder why they are paying for something that protects the person buying their home.
The reason is straightforward. By purchasing the owner’s policy, the seller is essentially proving to the buyer that they have the legal right to sell the property. They are willing to put money behind that claim. In arm’s-length transactions where buyers and sellers have never met, that assurance matters.
This is a talking point I address directly during listing appointments because it does affect what a seller walks away with at closing. Understanding it in advance makes the conversation much easier.
The Expanded Eagle Policy: A Line Item Most Agents Miss
This was one of my favorite parts of the conversation because it is something I have caught in purchase agreements that a lot of agents walk right past.
In every purchase agreement, there is a section covering what type of title insurance policy is being purchased. Most agents default to whatever the template says and never look twice. But depending on which brokerage is writing the purchase agreement, that section may default to an Expanded or Eagle policy rather than a standard policy.
The Expanded Eagle policy does offer more protections to the buyer, which can actually be a selling point in negotiations. But it also adds a few hundred dollars to the seller’s closing costs, and it is the seller who is bearing that expense.
As a seller’s agent, that section is worth reading. If the purchase agreement calls for an Expanded Eagle policy and your client is not negotiating it as a concession, you may be able to cross it out and substitute the standard policy instead, saving your seller money at the closing table. William confirmed this directly: that section gets missed by a lot of agents, and catching it is a legitimate negotiating point.
What Happens After a Title Order Is Placed
Once a purchase agreement is signed and the title order is sent over, here is what happens on the title company’s end.
The first thing William’s office does is go into what he calls defensive mode. They review who signed the purchase agreement. Is it a natural person? Is it an entity? If it is an entity, who signed on behalf of it? This matters because the answer determines what documentation will be required later.
Simultaneously, the file goes out for a search and exam. This is the process of pulling the full history of the property, which in Metro Detroit can span well over 100 years. Deaths, divorces, quitclaim deeds, subdivisions, combined parcels, probate proceedings, outstanding liens: all of it gets reviewed to identify what needs to be resolved before a clean policy can be issued.
That search and exam process typically takes two to five days. AI is helping speed that up significantly, which we get into below. But it is not a step you want rushed carelessly, because the details matter. A missed issue at the search and exam stage is how claims happen, and nobody wants to deal with a claim event.
The work product that comes out of the search and exam is called the title commitment. It lists every condition that needs to be satisfied before closing can proceed: paying off the current mortgage, obtaining an HOA status letter, providing a certificate of trust, or getting a probate letter of authority that establishes who has legal signing authority for the property.
Why Your Title Company and Your Agent Need to Work as a Team
Something William said that I want to highlight: the relationship between an agent and a title company is symbiotic. The agent is the expert in finding properties and negotiating favorable terms. The title company’s job is to make sure the money going out at closing goes to the right people, in the right way.
For that to work well, clients need to know who their title contact is before closing day arrives. That is why I now send a “Congrats on Escrow” email the moment a deal goes under contract. It includes the buyer, the lender, the title contact, and anyone else who is going to be a moving piece in the transaction. My client knows who William’s team is before they ever need to trust them with a wire transfer. That introduction matters, and it changes the entire dynamic when sensitive requests come in later, like asking for a divorce judgment or providing banking information.
Wire Fraud in Real Estate: What Every Buyer Needs to Know
Wire fraud is real, it is common in real estate transactions, and it is worth taking seriously.
Here is how it typically works. Someone intercepts communication between the buyer and the title company and sends a convincing-looking email with new wire instructions, directing the buyer to send their closing funds to a fraudulent account. Once the wire is sent, recovery is extremely difficult.
A few rules to know:
Title companies will never accept closing funds via Venmo or Zelle. It is also extremely rare for wire instructions to change once they have been established. If you receive any message saying that wire instructions have changed, treat it as a red flag and verify by calling the title company directly using a phone number you already have on file, not one provided in the suspicious email.
William’s recommendation, and one I pass along to all of my clients: if you bank with a major institution like Chase, Bank of America, or Huntington, go in person to send the wire. A bank employee will enter the information for you, adding a layer of protection against typos and giving the bank the opportunity to flag anything that looks unusual.
Closing Day: What to Expect as a Buyer
The experience varies depending on how you are purchasing.
Cash buyers have a relatively simple closing. Their document stack is lean, no notary is typically required, and most of the signing can be done electronically via DocuSign. The most significant task is making sure funds arrive safely and securely. From signing to done, it can genuinely take five minutes if everything is in order.
Buyers with a lender have a more involved process. An ideal closing day looks like this: title and lender are both clear to close a few business days in advance, which gives both sides time to prepare and balance the closing documents. The buyer receives closing documents at least two days before the scheduled closing date, with time to review, ask questions, and understand what they are signing.
When that timeline gets compressed, whether because of a rate lock deadline or a last-minute clear-to-close, it adds stress to an already emotional transaction. The professional parties involved need to communicate clearly and protect the buyer’s time as much as possible. Rushing someone through hundreds of thousands of dollars in documents is not good service. It should never feel that way.
Closing Day: What to Expect as a Seller
Sellers should expect to receive their closing documents the same day or the morning before their scheduled closing. This gives them time to review their seller proceeds, verify the affidavit language, and loop in an attorney if they have counsel involved.
The seller’s title company is the one drafting the bulk of the closing documents, which means they control the pace. A tech-forward title company can typically have documents ready within one to three hours once everything is in order. That speed matters when timelines are tight.
If there is a post-closing occupancy situation, the seller should also understand the difference between an occupancy escrow and a damage or security deposit escrow. These are two separate things, and confusing them is one of the most common negotiation mistakes William sees in purchase agreements.
Occupancy Escrow vs. Damage Escrow: Know the Difference
If a seller needs to stay in the property after closing, the purchase agreement will typically include an occupancy escrow, which is calculated based on a daily rate and held until the seller vacates. This escrow covers the cost of the seller’s continued use of the property.
A damage or security deposit escrow is separate. It is held in case the seller causes damage to the property during the move-out period.
These are not interchangeable. The occupancy escrow cannot be used to cover damage claims unless the purchase agreement specifically says so. When a purchase agreement only includes occupancy language and no damage deposit, buyers can find themselves without recourse if the seller leaves the property in poor condition.
If you are negotiating occupancy on behalf of a buyer, always negotiate both escrows as distinct line items. Spell them out clearly. William confirmed that this distinction gets blurred frequently, and the downstream consequences can get uncomfortable for everyone involved.
AI in Real Estate: What Is Actually Changing Right Now
William is enthusiastic about AI, and for good reason. He made a point that stuck with me: if you are not using AI today, you are at risk of being left behind, and the adoption curve is moving faster than the internet did in the 1990s.
For title companies specifically, AI is already accelerating the back-end processes in meaningful ways. When a purchase agreement comes into his office, AI tools now parse the document and extract key names, dates, and clauses, giving processors a structured summary rather than requiring them to read line-by-line from scratch. That alone is making order entry faster and more accurate.
On the search and exam side, AI programs are scanning property records, flagging items that need attention, and giving examiners a prioritized list to work through. The result is faster turn times without sacrificing the thoroughness that protects everyone in the transaction.
William described AI as Google 2.0. Where Google let you search and manually filter information, AI now does the aggregation and summarization for you. You still have to read and interpret the output and verify sources, but the time-consuming search work is largely automated. That is a real competitive advantage for the title companies embracing it, and for the agents and clients who work with them.
FinCEN and the New Anti-Money Laundering Reporting Rule for Real Estate
On March 1st, a new federal regulation took effect through the Financial Crimes Enforcement Network, commonly known as FinCEN. This is worth understanding if you are working with cash buyers, LLCs, or trusts in residential real estate.
The regulation targets 1-to-4-unit residential real estate and is designed to address the fact that residential properties have been used to move money in connection with cartels, criminal organizations, and other anti-American financial interests. It is an extension of anti-money laundering practices that institutional banks have been subject to for years, and it is now trickling down into residential real estate transactions.
Here is what it means practically:
When a cash buyer who is a non-natural person, meaning an entity, LLC, or trust, purchases a property, they are now required to complete a reporting form that identifies the beneficial owners of that entity and discloses the source of funds. This is submitted to FinCEN through the title company.
A few important clarifications from William:
Title companies are not responsible for policing the data. They submit what is provided. FinCEN takes that information and cross-references it against their existing records to determine whether further investigation is warranted.
The rule also applies to buyers using private loans, meaning loans from individuals rather than institutional lenders. If a buyer is getting a mortgage from Chase, Bank of America, Huntington, or another institution that already has AML practices in place, that transaction is not subject to this reporting requirement.
The cost to buyers is typically $300 to $400 in additional closing costs for the filing. If the buyer cooperates with the process, there is no meaningful delay. As a buyer’s agent, the best approach is to know upfront whether your client is a cash buyer, LLC, or trust, and coach them on the expectation before you get to the title phase.
William was candid that he personally supports this regulation. It adds minimal complexity while shining a light on a part of the market that needed more transparency. If you have nothing to hide, filling out the form is just one more step in the process.
Frequently Asked Questions About Title Insurance in Michigan
What does title insurance actually cover in Michigan?
Title insurance in Michigan protects you against losses that arise from defects in a property’s ownership history. This includes undisclosed liens, errors in public records, forged documents, unknown heirs who later make a claim on the property, fraud by someone impersonating the seller, and unresolved issues from previous transfers such as unpaid taxes, judgments, or boundary disputes. Unlike other insurance products that protect against future events, title insurance specifically covers events that occurred in the past and may not have surfaced during the search and exam process.
Who pays for title insurance in Michigan, the buyer or the seller?
In most Michigan real estate transactions, the seller pays for the owner’s title insurance policy as part of the closing costs. This is the standard practice established in most purchase agreements used by brokerages and associations in the state. The seller is the one proving they have the legal right to transfer ownership, so they bear the cost of that assurance. That said, like most things in a real estate transaction, it is negotiable. The type of policy being purchased, standard or Expanded Eagle, is also a negotiating point that agents on both sides should review carefully.
What is the difference between a standard and an Expanded Eagle title policy?
A standard title policy covers the core protections for a property buyer. An Expanded or Eagle policy provides broader coverage, including protections for issues that might arise after the policy is issued, such as building permit violations, encroachments, and certain zoning issues. The Expanded Eagle policy costs a few hundred dollars more and is paid by the seller in a standard Michigan transaction. Buyers’ agents sometimes default to requesting it without realizing the cost impact to the seller. Sellers’ agents should review the title section of any purchase agreement and decide whether to accept the Expanded Eagle request or negotiate back to the standard policy.
How long does the title search and exam process take in Michigan?
Typically two to five business days, though this can vary depending on the complexity of the property’s history. A property with a clean, straightforward chain of title and no outstanding liens will move through the process quickly. A property with estate involvement, past quitclaim deeds, combined parcels, or unresolved judgments will take longer. AI tools are helping title companies accelerate this process without sacrificing accuracy. If you are working with a cash buyer who needs a quick close, choosing a tech-forward title company that can turn search and exam faster is a real advantage.
What is a title commitment, and why does it matter?
A title commitment is the formal document produced at the end of the search and exam process. It outlines the conditions that must be satisfied before the title company will issue the final policy. Common requirements include payoff of the existing mortgage, an HOA status letter, or documentation related to an estate, trust, or probate proceeding. The title commitment is essentially a checklist of everything that needs to happen before closing can proceed. Reviewing it early gives buyers, sellers, and agents the maximum amount of time to address any issues before the closing date.
What is wire fraud in real estate and how do I protect myself?
Wire fraud in real estate typically involves a scammer intercepting communication between a buyer and a title company and sending fraudulent wire instructions that direct closing funds to the wrong account. Once the money is wired to a fraudulent account, recovery is very difficult. To protect yourself, never send funds via Venmo or Zelle, as legitimate title companies do not accept closing funds through those platforms. Be extremely skeptical of any message claiming that wire instructions have changed. If you receive such a message, call the title company directly using a number you already have on file to verify before taking any action. If possible, go in person to your bank to initiate the wire transfer.
What is the difference between an occupancy escrow and a damage escrow in Michigan real estate?
An occupancy escrow is money held after closing to cover the seller’s continued use of the property during a post-closing occupancy period. It is calculated based on a daily rate and released once the seller vacates. A damage or security deposit escrow is a separate amount held to cover potential damage the seller causes during the move-out period. These two escrows are legally distinct and cannot be interchanged unless the purchase agreement specifically allows it. Buyers’ agents should negotiate both escrows as separate line items whenever a seller is requesting post-closing occupancy. Failing to include a damage escrow leaves the buyer without recourse if the property is not returned in acceptable condition.
What is the new FinCEN rule for real estate and who does it affect?
The Financial Crimes Enforcement Network (FinCEN) implemented a new reporting rule effective March 1st that applies to cash purchases of 1-to-4-unit residential real estate made by non-natural persons, meaning LLCs, corporations, partnerships, and trusts. These buyers are now required to complete a beneficial ownership reporting form that identifies who ultimately owns or controls the purchasing entity and discloses the source of funds. The requirement also extends to buyers using private loans, meaning loans from individuals rather than institutional lenders. Buyers using mortgages from banks and institutional lenders are not subject to this rule. Title companies collect and submit the reporting on behalf of buyers. Expect an additional $300 to $400 in closing costs for the filing fee. If the buyer completes the form promptly, there is no meaningful delay to the transaction timeline.
Do I need a title company if I am buying with cash in Michigan?
Yes. Even in an all-cash transaction, a title company plays an essential role. The title company conducts the search and exam to confirm that the seller has clear, unencumbered ownership of the property and that there are no outstanding liens, judgments, or other claims that would transfer to the buyer. Without this process, a cash buyer has no way to verify that the person they are purchasing from has the legal right to sell, and no protection against ownership claims that surface after closing. Title insurance is just as important in a cash deal as it is in a financed one, and in many ways even more so because a lender’s policy is not involved.
Ready to Buy or Sell in Metro Detroit?
Whether you are selling a home in Grosse Pointe, downsizing from Birmingham, or buying your first place in Northville, understanding what happens at the closing table puts you in a far stronger position throughout the transaction. That is what I am here for.
Contact me today and let’s discuss your next move.