How to Do a Title Search?

A title search company or a lawyer can help you. You must still understand conducting a title search to monitor the process and identify potential outcomes. This guide on how to do a title search will guide you through the process.

 

The Title Search

Title searches are searches through property records to determine whether encumbrances may affect, hinder, or alter the transfer of a property title. A property title provides the right to freely use a piece of real property that belongs to the owner.

When searching for a property title, ensure the seller and current owner hold all the rights associated with the property. You aim to determine whether the seller is authorized to transfer property ownership legally.

If there are any prior claims, liens, or judgments against the property (such as unpaid taxes or a break in chain of title), a “cloud of title” or a “title defect” can result. This may invalidate the sale of the property or transfer the seller’s obligations.

The process of buying a home begins with a title search. Afterward, most mortgage lenders require you to obtain title insurance to protect you against potentially burdensome encumbrances on your title.

 

Title Searches: How They Work

An analysis of the title to a piece of property determines whether it has a clean title or if there are any liens, such as public record errors, that prevent the property from being transferred.

When a prospective buyer wishes to make an offer on a property, a title search typically occurs by a title company or attorney. It is also possible for a lender or other entity to initiate this process to determine if the property has been subject to claims or judgments. A lender or other entity usually conducts this process before approving a loan or additional credit that uses the property as collateral. An entity searching conducts research using public records and legal documents to determine who owns the property, what liens are on it, what loans are on it, and what property taxes are due.

Although prospective buyers or other individuals can conduct title searches independently, this is not advisable because of the complexity of legal documents and the difficulty of accessing court records.

 

What Is The Purpose Of Title Searches?

You can protect yourself and conduct a title search by minding your due diligence. You should ensure the property owner is free and clear by doing a title search. Finding out the owner is only the first step, and you should make sure you investigate further. You could end up with a property with liens and claims if not.

Depending on the transaction details, you may find out the current owner has an old claim against their title, which they must be aware of. Or you may find out that previous owners owed money on the property, now yours to purchase.

In cases where the title search fails, you may need to be aware of serious debts such as unpaid property taxes and homeowners association fees. This is why most mortgage lenders require title searches and title insurance before granting you a loan.

 

Usually, Who Performs A Title Search?

Usually, the real estate agent or Title Company conducts the title search on behalf of the buyer or mortgage lender. The title abstractor is generally responsible for much of the due diligence involved in the title search process.

An abstractor searches through property and land records, verifies ownership, prepares leases, and resolves disputes as part of their duties. These professionals work with real estate agents, lenders, or other legal parties to gather all the information necessary for a title search. Though performing your title search can be cost-effective, it is a complicated and detailed process that requires expert assistance.

 

What Are The Best Times To Get A Property Title Search?

In most instances, the title search takes place at closing. The closing process occurs after the buyer accepts an offer but before the property officially transfers to the buyer.

Property investors may sometimes request a title search to be conducted independently of the home-buying process. This may occur when they consider buying a property and wish to ensure it is unencumbered.

 

Performing a Title Search

The average home buyer may need more details in their title search, which is why you should use a professional, but if you do it yourself, you can save a few hundred dollars. Here’s how:

 

 

1. Start your search online.

A county’s public records are often available online, which you can search via your state government’s website. Find your county on the website, and then search for the property title you’re interested in.

 

2. Find tax records.

With tax records, you can view more detailed information about your property and ensure that your property taxes are current. In addition, tax histories give you a better idea of the property’s current fair market value by providing an accurate assessment of the property’s value over time.

To ensure that your property purchase is free from encumbrances, you can check the county’s tax assessor’s office for records of tax liens.

 

3. Check for a transparent chain of titles.

Verify that the owner’s current name matches the name of the deed. Ensure there are no other legal claims or privileges against the property that can lessen its value by obtaining all deeds for the property for the last fifty to seventy years.

Generally, you check for a transparent chain of title, which verifies sequential ownership of the property. Counties often maintain a comprehensive archive of property deeds at the county recorder’s office. A city or county clerk can help you find public resources to aid your title searches, such as county courthouses, county records offices, city archives, and city halls.

 

4. Look up the abstract of the title.

The abstract of the title summarizes the property history, including any tax liens, foreclosures, inheritances, unpaid taxes, easements, or encroachments, starting with the grant deed.

This document chronologically establishes the chain of title and is prepared by abstractors in conjunction with the county clerk’s office or other appropriate land title offices. You should obtain a copy of the most recent abstract of the title before entering into the purchase negotiations.

 

5. Document your findings.

You should then prepare a written document outlining the property’s legal description, tax history, chain of title, and any other pertinent information you have found.

 

6. Consult a real estate attorney.

To conduct a successful title search, you should seek professional assistance. If you have documented the necessary information, speak with a real estate attorney about what to do with your data. In addition to answering questions about complicated legal documents, they can advise you on dealing with encumbrances.

 

7. Go through the title company.

The title company verifies property ownership in partnership with real estate agents. As a result, their company files may include current property owner information and titles from past owners. A self-assembled report will likely contain less comprehensive records than an individual title company.

 

The Benefits of a Title Search

The following are some of the benefits of conducting a title search:

 

1. Clarifies ownership:

A title search must examine public records closely to ensure that the potential homebuyer has the authority to purchase the property. The seller’s name may need to be added to the deed, or the original seller did not appear on the deed.

It is possible for a seller not to realize they aren’t legal owners of the property, which would void their right to sell it. Nevertheless, a title search can assist in identifying the legal property owner and establishing the chain of title.

 

2. Exposes existing claims:

Performing a title search reveals whether the property is subject to any liens, outstanding property taxes, or any other current claims. A property title search can protect potential buyers from inheriting financial debts since those legal obligations pass on to them (whether they intend to or not).

 

3. Reveals restrictions:

An easement or other restriction allowing third parties to use a piece of property will often appear in a title search. By knowing these variables, potential buyers can prepare for possible legal issues or disputes over the land.

 

If A Title Search Fails, What Should I Do?

When investing in real estate, you’re bound to run into some problems occasionally. Common title search problems might include:

• Fees not paid to contractors.
• Loans owing
• Utility bill easements
• Insolvencies
• Bet debts or gambling debts
• Liens for child support
• Property Restrictions
• Taxes owed

A few strategies can rectify such problems. To clear the title, you should work with the seller to pay off any debts they have. In this case, you could demand that they pay off their debts, or you will not submit an offer.

The amount needed could also be split between both of you. You may even offer to pay off their debts if the deal is so sweet! However, it depends on the unique circumstances and the buyer and seller incentives.

Secondly, you can purchase title insurance. You won’t have to pay monthly bills like with other types of insurance if the title search needs to include anything or if any past issues come up again. With title insurance, you only pay a one-time premium at closing.

 

Can You Conduct Your Title Search?

You can do a title search, which would be time-consuming and challenging. First, you will have to contact counties and research public records on the Internet, which is time-consuming in and of it.

As for legal savvy, you must identify the proper documents and know what you seek. A title search company or an attorney would be a better way to spend your time considering the opportunity cost.

 

What Is The Importance Of Title Searches?

Buying a house gives you an official title to file with your state or local government. Like buying a car, comparing different properties and determining what you can afford is complex. The title proves ownership and may also indicate easements or liens associated with the property.

It is possible for someone or something to use an easement to access your property, such as when a neighbor can only get to their house by crossing yours to access theirs. An easement is often necessary for public access to parks or other areas open to the public, such as utility lines.

There are few fraud cases when people sell their homes fraudulently, but disputes over boundaries, fences, or trees close to property lines are common. To ensure the security of your investment, you need to remove as much risk as possible. A title search may reveal:

• The home’s legal owner.
• Addresses on the ground.
• Boundaries of latitude and longitude.
• Infrastructural improvements.
• The lien.

 

What Information Do We Need When We Are Searching For A Title?

In most states or counties, a title search requires only the physical address or the current owner’s name. However, some counties or states require a lot or parcel number.

Property for sale may include more than one parcel or lot. A property description or parcel map can help you determine if this applies to your potential purchase. The property description or parcel map may indicate whether this has occurred at one time. Each parcel may require a title search.

We can complete recording easements differently by different governments. Some easements may not appear on the title or may need to provide more information. A city may, for example, maintain a universal utility easement covering every property with sewer or utility lines, whether above or below ground.

If an easement exists, you may only be legally bound by existing uses, especially if you know these when on site. It might be necessary to obtain an Affidavit of Title certifying a clear property title from the current owner when you visit the property since there may be unwritten easements, such as a hidden path or access route to neighboring parcels.

 

Bottom Line

As a real estate investor, you’ll buy many properties throughout your career. Knowing how to search for a title on a property is one way to protect yourself. You must do your due diligence every time you make a deal and ensure that nothing will backfire on you. Title searches usually take place at closing, and a professional handles them.

Despite this, knowing how a title search works and what issues you should look out for to hold the process accountable is a good idea. You are responsible for taking care of yourself and not messing yourself up.