Your Real Estate Mama
Get practical tips, expert advice, and encouragement for home buyers and sellers on Your Real Estate Mama—the go-to weekly podcast for all things real estate.
Hosted by Jan Scott, a seasoned real estate broker with over 35 years of experience and 25 personal moves, this podcast offers quick, bite-sized insights into the home buying and selling process. Whether you're a first-time buyer or experienced seller, Jan’s knowledge, heartfelt stories, and Southern charm will guide you every step of the way.
Stay connected by following us on Facebook @YourRealEstateMamaPodcast for updates, tips, and more. Got questions? Reach out to Jan at jan@yourrealestatemama.com—she’s always happy to help!
Your Real Estate Mama
Unlocking Closing Day Secrets: Title Policies, Fraud Prevention, and Real Estate Tips with Traci Newby
What really happens behind the scenes on closing day? This week on Your Real Estate Mama, Jan Scott welcomes Traci Newby from Anchor Title to unpack everything you need to know about title policies and the crucial role title companies play in ensuring your home purchase is smooth and secure. Traci, with over 25 years of experience in the real estate title industry, shares insider knowledge about title searches, clearing title requirements, and preventing common pitfalls like fraud and title defects.
Plus, discover why Alabama's unique tax laws matter to out-of-state property owners and learn about new regulations aimed at combating money laundering and protecting buyers. Whether you're buying your first home or you're a seasoned pro, this episode is packed with actionable advice and southern charm.
Stay tuned until the end for a dose of Mama Wisdom & Inspiration that will remind you why a house is so much more than just a transaction—it’s where your story begins.
👉 Don’t miss this episode if you want to buy or sell a home with confidence!
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Looking to buy or sell a home? Tune in for real estate tips, expert advice, and real-life stories to help you navigate the housing market with confidence! 🏡 Plus, get a little mama wisdom to make your home journey smoother.
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Email: jan@yourrealestatemama.com
Follow on Facebook: @YourRealEstateMamaPodcast
Chapter 1: Welcome and Introduction
MamaHost
00:00
Have you ever wondered what exactly a title policy is or why it's so important? What steps happen behind the scenes to ensure your home is yours, free and clear? Today's guest is here to explain it all. Let's get to it. Hey there, welcome to your Real Estate Mama. Hey there, welcome to your Real Estate Mama. I'm Jan Scott and I'm here to help you navigate the ups and downs of buying or selling a home. I've been wrangling the real estate market for over 35 years and, trust me, with all this gray hair comes a whole lot of wisdom. I'm excited to share tips, a little humor and plenty of encouragement to make your journey easier, whether you're new or a regular. I'm so glad you're here. Follow the show for new episodes every week, and together we'll grow and help even more folks.
Today we're diving into one of the most exciting and sometimes nerve-wracking moments in a home buying journey—Closing Day. I'm thrilled to have a true expert with us today, someone who knows everything there is to know about what happens behind the scenes when we finally get that long-awaited clear to close. We're talking with a closing expert who's going to break down what title companies and closing attorneys are really up to as they prepare for our big day.
Chapter 2: Introducing the Guest
MamaHost
01:47
Today I have with me Traci Newby. Traci is with Anchor Title and Traci and I go back a long way. We both used to live in North Alabama. She, like me, decided to move down here to this beautiful Alabama Gulf Coast and she has worked both in Alabama and Tennessee in the real estate title industry for 25-plus years. Traci, welcome. She has three kids, and she lives down here, and it's just amazing to get to work with her again.
Today, we're going to start with a very basic question. A lawyer comes into the closing. What we see—all we see—is a big stack of papers when we go to closing and we're sitting there and he's flipping through asking us to sign and sign. And one of those is a very important paper. It's called a title. Can you explain to the listeners today a little bit about what happens once the lender requests a title on a certain property that's under contract?
Chapter 3: Behind the Scenes of Title Searches
TraciGuest
02:40
So we order the title search, and an abstractor either goes to the courthouse or goes online. Some counties, their documents are online, and basically does a title search. That means that they pull every deed, every mortgage, every lien—anything that is against the seller or the buyer or against the property. They will pull it, they'll compile it, and then they send it to us.
It then goes to our underwriting, and our underwriter is the one that looks over the title. If there's anything that needs to be corrected, if there's anything that needs to be like payoffs ordered or HOA information ordered, we get a commitment. The commitment is basically our blueprint. We get that, and it tells us exactly what we have to clear in the requirements before we can get to the closing table. And so we go off that commitment, and then after that, we send it to the lender and then we get ready to close.
Chapter 4: Challenges with Title Searches
MamaHost
03:49
So there's a lot of work that goes behind the scenes to get to that closing table that day. You know, in a perfect world, everything is clear, and there's no problems, and you sign and go to closing, and you have clear title on your home. But we all know we don't live in a perfect world. That is correct. So tell me what some of the clouds that maybe have come up on titles that you have found over the years?
TraciGuest
04:12
Title insurance—it protects us against claims or defects, and you only have to pay for it once. But defects are things such as a person claiming ownership, say it was an estate that sold the property, and I've had this happen, and two of the children said they were the only two children, and then after closing, we had a third child that nobody knew about. So it would protect you against that. Improperly recorded documents, fraud—which you know we hear so much about now— forgery, liens, encroachments, and easements are other things that sometimes will cause issues.
Chapter 5: Stories from the Field
MamaHost
04:59
That reminds me—I go way back on this story with my good teacher up in North Alabama, Everett Brooks. Somebody got a knock on their door one day, and they came to the door, opened it. There stood a gentleman, and he said, "I own this property. I have the title and the deed here. You need to make plans to vacate the property." So of course, the guy goes to the attorney the next day and starts researching it and, come to find out, the title company had missed something way back in the chain of title, and they had to vacate the property.
And so for this reason, all of the owner's title insurance and all of the lender's title insurance policies have come with new conditions and stuff. Can you kind of explain to us the difference between owner's title policy and a lender's title policy?
TraciGuest
05:53
Yes, an owner's title policy protects the owner—the person purchasing it—from the time they bought it backward. It doesn't protect the future; it's backward. A lender's policy is the same thing, but it protects the lender against any claims or defects.
Chapter 6: Fraud in Real Estate
MamaHost
06:12
You know, I have also recently heard that there is fraud going on now, with people claiming that they own the property. They're actually changing that? Have you had that happen? Has that come up in any of your searches?
TraciGuest
06:23
Not yet—that has not happened. But we have seen a lot of fraud in the industry, and it seems like they come up with something new pretty much every day.
MamaHost
06:36
Just use that smartness for good, then I think that would be great.
Chapter 7: Alabama Withholding Tax
MamaHost
07:04
Let's talk about some things that I didn’t know about until I got down here close to the condo and the beach area. About Alabama withholding tax when the owner is non-resident, and this is either a second home or maybe they have it as an investment property—Alabama charges a tax. Can you tell us about the Alabama withholding tax, how that works?
TraciGuest
07:22
Yes, so there is an income tax withholding that Alabama collects from non-residents, and it is based on the buyer, not the seller, because if it’s not paid, they’re going after the buyer. If the buyer is an individual, the tax is 3%. If the buyer is a corporation, LLC, or trust, it’s 4% of the gain.
So they have to fill out what’s called a seller’s affidavit of the gain. They have to put the purchase price, any improvements, what they paid for it, and then any depreciation. We put the amount that they’re paying in closing costs, and you subtract all of those from the purchase price to get what is going to be calculated with either 3% or 4%.
MamaHost
08:07
That's just something that we need to make sure that we tell all of our sellers that do not reside in the state of Alabama when they get ready to sell.
Chapter 8: FinCEN Regulations and Transparency
MamaHost
08:18
Now, let’s shift gears a little bit. This is something I’m still learning about. In August of this year, there was a big talk about the Financial Crimes Enforcement Network, or FinCEN for short. They announced a final rule that’s designed to combat and deter money laundering by increasing transparency in the U.S. residential real estate sector. Can you tell us a little bit about this rule, because I’m still learning about it, too?
TraciGuest
08:58
Yes, the rule will go into effect December 1, 2025. It applies to cash transactions or transactions with hard money loans—that is, loans from an individual and not a regular lending institution that reports to FinCEN. If the buyer is an entity like a corporation, LLC, or trust, we have to report them to FinCEN.
So, the point I want to make sure people know is that if you do a lot of real estate and you have an LLC or a trust, you’re going to need to register with FinCEN and get a FinCEN identifying number, because we will require it at closing.
Chapter 9: FIRPTA and Foreign Investment
MamaHost
10:00
The government wants to make sure that money is legitimate, honest, and correctly made to keep money laundering down. Keeping with the transparency of corporations, there’s another new thing I’m learning about called FIRPTA. Can you tell me what that stands for and what it is?
TraciGuest
10:29
It stands for the Foreign Investment in Real Property Tax Act. If you are not a U.S. resident, we have to withhold 15% based on the contract price for any foreign seller. It’s designed to ensure foreign corporations or individuals don’t sell property here and avoid paying taxes on the gain.
MamaHost
11:06
That sounds like another good rule.
TraciGuest
11:08
It is.
Chapter 10: Fraud Prevention Tips
MamaHost
11:10
Anything else that we need to know? If my listeners are very green, I need it on a simple level. Is there anything else you can share with us about the title company’s job?
TraciGuest
11:26
One thing is that fraud is rampant throughout the country. Never send a wire without verifying it with your title company. Don’t call the phone number in an email—call the number you’ve been given by your real estate agent or loan officer, or look it up yourself. Seller impersonation, where people pretend to be sellers, has been pretty bad. One in four title companies that lost money in fraud cases wasn’t able to retrieve it.
MamaHost
12:11
It’s terrible, especially with wire fraud. I can’t imagine sending $150,000 through a wire and then it’s gone.
TraciGuest
12:25
Exactly.
Chapter 11: Services Offered by Anchor Title
MamaHost
13:00
Tell us a little bit about Anchor Title. What kind of services do you all offer?
TraciGuest
13:08
We focus on residential real estate. We also have three attorneys on staff who can help with setting up LLCs, estates, and trusts. Having those attorneys available makes everything more streamlined and helps resolve issues quickly.
MamaHost
13:50
That’s so important. When you’ve got a great team around you, it just makes everything run smoother.
TraciGuest
14:00
Absolutely.
Chapter 12: Closing Wisdom and Inspiration
MamaHost
16:16
Traci, thank you so much for joining me today. It has been a pleasure, and I look forward to doing it again.
TraciGuest
16:23
Thank you so much!
MamaHost
16:29
As always, I like to leave you with some Mama wisdom and inspiration.
A house is so much more than a transaction—it’s a blessing. It’s easy to get caught up in the numbers and stress, but don’t lose sight of what a home truly represents. A house isn’t just about square footage or curb appeal—it’s where your life will unfold and your story will be written.
That’s a wrap! Follow the show for new episodes every week, and don’t forget to leave a review or send me your questions at jan@yourrealestatemama.com. Be sure to follow me on Facebook @YourRealEstateMamaPodcast. Until next time, happy house hunting, and remember—you should always listen to your Mama.
