Terms and titles often overlap and can cause confusion in the real estate transaction process, especially if you are a first time buyer or you have been in your current home for a long time. First of all, let’s identify and review the key players in a typical real estate transaction:

Listing Agent/Realtor– Usually engaged by the local seller to market and sell an existing property. Generally assists in helping the seller get the highest possible price and best terms for their property. General market practice is for the seller to pay the total Realtor’s sales commissions which on average runs in the 6-8% of sales price with half the commissions going to the Buyer’s Agent if not one in the same. While these are customary local market pricing models, pricing can vary with each transaction.

Buyer’s Agent/ Realtor– Engaged by someone interested in purchasing a new home or property. Agent identifies prospective homes, engages the Listing Agent for showings and works with the buyer to get the best possible price and best terms. Typically, the sales commission to the Buyer’s Agent is paid by the Seller and generally ranges in the 3-4% of sales price. Again, while this is customary market pricing, pricing can vary.

Lender– Usually a bank or mortgage company that lends the money to the buyer.

Loan Officer/ Mortgage Broker – A representative of the lender, bank or mortgage company (sometimes referred to as the “LO”) who works directly with the buyer/borrower to pre-qualify the borrower, complete the loan application and assemble needed documents for loan approval.

Loan Underwriter– The underwriter generally works in a separate lender department and provides detailed reviews of the borrower’s ability to repay the debt, reviews all assets and past credit history. The underwriter will also review property details, appraisal, survey and title search reports before making the final loan approval.

Loan Servicer– In many cases, this will not be the same lender that you borrowed your money from to purchase the property. These institutions provide after-closing servicing to process your mortgage payments and manage your escrow accounts that go to paying your taxes, homeowner’s insurance, etc.

Title Company or Closing Company – Our Company is the hub of the real estate transaction once the property is under contract. We work and communicate with all parties in the transaction and pull documents together to facilitate the transfer of title and funding for the transaction.

Escrow Officer and/or Settlement Agent– Both titles are commonly used interchangeably. Typically the role of the Escrow Officer is  to disburse funds in accordance to the sales contract and lender instructions and the Settlement Agent facilitates the closing by preparing and recording all documents. In Florida, both functions are generally handled by one person with additional support from their treasury, accounting and title departments.