Five Essential Things to Know About Title Search: What It Is and How it Works

The title search is a critical step in the home buying process.

Most people assume home sales are standard business transactions and they often are. However, the consequences can be catastrophic if someone with a valid claim or lien on the property shows up down the road. A comprehensive property title search protects the buyer by examining public records on the real property in question to confirm its rightful legal owner. It should also reveal if there are any outstanding claims or liens on the property that could affect the purchase. You can see why being armed with this information is vital for prospective homeowners.

Read on for five important facts about title searches that every homebuyer needs to know.

1. Title searches go to extensive lengths to identify who owns the property in question.
   A title search digs into the public records available for the property at issue. A qualified attorney or title company examines a variety of legal documents, such as past deeds, wills, divorce decrees, and tax records to confirm that the seller is truly the rightful owner. In addition, the search uncovers any other financial and/or legal claims on the property. This information is used to create an ‘abstract of title’. The abstract of title includes a recorded chronology of all available documents and transactions related to the parcel of real estate in question. The abstract could include the current owner and previous owners. It could also include past surveys of the property, any easements that cross the property, and any pertinent wills and lawsuits.

2. It can uncover financial rulings against the previous owner that might affect you in the future.
   The title search must show clear and free ownership of the property. If any outstanding claims exist, such as liens, property taxes, home improvement bills, or easements, they could quickly put a damper on your happily ever after. That’s why it’s imperative to eliminate these issues before proceeding with the sale.

3. Title insurance offers added protection.
   There are additional ways to mitigate the potential risk of a claim on your new property’s title. The one-time purchase of a title insurance policy can protect your ownership claim of the property. Unpaid property taxes, homeowner’s association fees, bills for home improvements, and the like could become your responsibility without a title search or if the title search failed to find them. That’s why lenders require both title searches and title insurance as part of the mortgage underwriting process. But even the best title search can’t always predict when a long-lost heir will show up to lay claim to a property or other similar scenarios.  And that’s where title insurance steps in to save the day.
   

4. The length of time involved varies widely.
   Depending upon the number and complexity of the documents surrounding a property, the time it takes to conduct the title search can vary dramatically. The search involves obtaining records from multiple sources, which can delay the process if an office is slow to respond. Once the documents are received by the title company examiner, it could take anywhere from a few hours to several weeks to review them in detail for any outstanding claims. A newer home will typically have fewer documents to comb through, resulting in faster completion. An older home may have more records that require review, which could prolong the process.

5. The title search should be left to the professionals.
   A title company or attorney will typically take care of the title search and it’s wise to let these professionals handle this part of the home buying process. The importance of having a title that’s free of any outstanding claims cannot be overstated. The legal documents involved are numerous and complex, and without a trained eye, something important can easily be overlooked.

A title company or attorney will typically take care of the title search and it’s wise to let these professionals handle this part of the home buying process. The importance of having a title that’s free of any outstanding claims cannot be overstated. The legal documents involved are numerous and complex, and without a trained eye, something important can easily be overlooked.

The best way to feel confident about your home purchase is by understanding what’s involved.

For more information about title searches or any other aspect of your home’s sales process, please contact our helpful team of professionals.

About Certified Title Corporation: Since 1994, attorney-owned Certified Title Corporation has been furnishing residential and commercial real estate stakeholders across the nation with robust title insurance, settlement, and escrow services. Renowned for industry-leading reliability and an exemplary level of service and quality, the Maryland-based company helps clients from all walks of life achieve their asset goals. To learn more, call (888)486-5511 or visit https://www.certifiedtitlecorp.com/.