Which party typically pays for the title examination in a real estate transaction?

In a real estate transaction, the responsibility for paying for title examination is generally determined by negotiation between the buyer and the seller as part of the transaction's terms. This reflects the flexibility in real estate agreements, where parties can agree on who bears particular costs based on their negotiations and the specifics of the deal.

The practice of negotiating this cost allows both parties to take into account various factors, such as local customs, the bargaining power of each party, and the overall arrangement of the sale. While some regions may have customary practices—where either the buyer or seller typically pays for the title examination—these customs can vary significantly, meaning that neither party is definitively responsible without mutual agreement.

In contrast, attributing the cost to just the buyer or just the seller overlooks the flexibility inherent in real estate negotiations. Similarly, suggesting the title company covers the cost is inaccurate, as the title company typically charges fees for their services, which would need to be paid by one of the parties involved. Therefore, the correct understanding is that this cost is often negotiated between the parties involved in the real estate transaction.