Real Estate Definition: Title Search

Buying or selling a property requires legal steps, including signing legal documents and transferring ownership between owners. Another crucial step is conducting a title search. You’ve probably heard title search before,  but what exactly does it mean? Understanding what title search is is essential to ensure a smooth and secure transfer of ownership. Let’s discover the importance of title search and how it can protect you and your investment.

What is a Title Search?

A title search is reviewing the public records of a property to determine ownership history and to ensure that there are no outstanding claims or liens against it. It also ensures that the seller has the legal right to sell the property to you. This is usually done by a real estate lawyer or title company. During a title search, various documents related to the property will be reviewed, such as deeds, mortgages, court records, and tax records, to determine any potential problems in the property’s title. The most common issues that could arise include unpaid taxes, outstanding mortgages, judgments, or other liens. Not that if there are issues found on the title, it could prevent the buyer from obtaining a clean and marketable title for the property.

Why is Title Search Important?

A title search provides you peace of mind. Knowing that the property has a clean title and is free from legal issues gives you the confidence to proceed with the transaction. It does not only protect your investment, but it also ensures that you are not inheriting someone else’s legal problems.

Conducting a title search also helps establish the legitimacy of the property’s ownership to ensure that the person selling the property has the legal right to do so. If a property has outstanding liens, the seller may not have clear ownership, and the property could be at risk of foreclosure or legal action.

Who Conducts a Title Search?

While it is possible to conduct a title search on your own, it is highly recommended to hire a professional title company or a real estate attorney. These professionals have the expertise and resources to conduct a thorough investigation and provide you with accurate and reliable information. Once the search is complete, they will provide a title report summarizing their findings and highlighting potential issues.

Do I Need a Title Search?

You may be confident about purchasing a property; however, a title search is required if you’re financing the purchase. If you skip the title search, any unpaid homeowners association fees, bills, or property taxes will become your responsibility. Moreover, paying for a title search is better than losing your home or dealing with an expensive lawsuit in the future. While it may seem like an extra hassle, there are several benefits to a title search being performed before closing the deal.

Avoiding Legal Issues

A title search can help you discover unresolved disputes, boundary issues, or easements that may affect your use of the property. Identifying these issues beforehand will help you decide whether to proceed with the purchase or negotiate with the seller to resolve the problems.

Title Insurance Protection

Title insurance is also crucial when buying a home. Title insurance protects you against damages or claims after purchasing a property due to issues in the title or ownership. The  basic title insurance policy typically covers the following:

• Outstanding liens or lawsuits against the property
• Defective record-keeping
• Ownership by another party
• Fraud and forgery of title documents
• Restrictive covenants

How Long Does a Title Search Take?

A title search may take around 10 to 14 days to complete, depending on the documents associated with the property. The process can take longer if the title company needs to obtain records from multiple sources, the process can take a little longer. Moreover,  the title search can take more than 14 days for older properties because the attorney will review more records.

Final Thoughts

Conducting a title search is a crucial step when purchasing real estate. It helps identify any liens or encumbrances, helps avoid legal issues, enables obtaining title insurance, and ultimately gives you peace of mind. Protect yourself from potential headaches and ensure a smooth and secure real estate transaction by investing time and effort in conducting a title search. Most importantly, it provides peace of mind and confidence when purchasing a property!