Protect Your Purchase: The Importance of a Real Estate Title Search

Answer

Before finalizing a real estate purchase, one of the most important steps is performing a title search. This process uncovers the legal history of a property, ensuring you receive clear and undisputed ownership. It protects both buyers and lenders from hidden claims, liens, or disputes that could jeopardize your investment.

What Is a Title Search?

A real estate title search involves examining public records to confirm the property's legal ownership and identify any potential issues. Conducted by a licensed title examiner or title company, this review ensures there are no outstanding claims or restrictions affecting the property.

Key Steps in a Title Search

• Review of Public Records: The examiner traces the chain of title, reviewing all previous transfers, mortgages, court judgments, and recorded documents to confirm each owner’s legal right to sell.
• Identification of Liens and Encumbrances: The search highlights any unpaid taxes, mechanic’s liens, HOA dues, or court judgments that could legally attach to the property.
• Verification of Easements and Restrictions: The examiner checks for recorded rights or limitations—such as shared driveways, utility access, or land-use restrictions—that could affect your intended use of the property.

Why a Title Search Is Essential

• Financial Protection: Any unresolved liens or debts may transfer with the property, making you financially responsible. Even a small, overlooked claim could lead to legal action or foreclosure.
• Clear and Legal Ownership: A thorough title search prevents disputes over property boundaries, inheritance rights, or fraudulent transfers.
• Title Insurance Eligibility: Most lenders require a lender’s title insurance policy, while buyers can opt for an owner’s policy. This insurance, typically costing around 0.5% of the purchase price, safeguards against covered title defects and legal costs (source: ALTA).

How Long Does a Title Search Take?

The process usually takes between 1–2 weeks. Once completed, you will receive a title commitment, which outlines the terms and conditions that must be satisfied before closing, such as paying off existing mortgages or resolving any identified liens.

Before You Close: Important Final Steps

Before completing your purchase, it’s highly recommended to:

• Consult a licensed title company or local real estate attorney to review the title search results.
• Understand any listed exceptions or restrictions on the property.
• Secure appropriate title insurance to protect your investment and ensure a clean, marketable title.

By taking these proactive measures, you can confidently close on your property, knowing your ownership is clear, legal, and protected against unforeseen claims.