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A real estate title is a document that shows ownership of a property. Conducting a title search is important to ensure there are no liens or restrictions on the property before purchasing. It is recommended to have an attorney or securities firm conduct the search or take out title insurance.
A real estate title is a document detailing an owner’s interest in a piece of property. Titles are typically registered with a government agency for the purpose of documenting ownership of land over time. Conducting a title search is something that can usually be done in the court of the jurisdiction where the land in question is located. The main reason for conducting a title search is to ensure that there are no liens or other restrictions on the property in question before purchasing.
Land titles are usually arranged by both the grantor – the person selling the property – and the lessee – the person buying the property. To conduct a title search, the searcher should start with the current owner’s title deed by looking for his or her name in the Beneficiary Index. The investigator should be sure to look very carefully at any judgments, liens, mortgages or tax claims relating to the property that he or she was not previously aware of. Starting with the current deed and working backwards through the entire chain of title, the investigator should be able to determine whether there are any encumbrances on the property.
If there are no previously unknown liens on the land found through the title search, then the seeker can feel confident in purchasing the property without subjecting himself to a land liability. In some circumstances, however, a title search will reveal defects in the title such as a judgment lien, which is an interest on property given to the creditor in the event that the debtor fails to pay the creditor after a judgment has been rendered. A lien of any kind will legally prevent the property from being sold unless authorized by its owner through the payment of the debt.
Another example of something that might show up in a title search is an easement previously unknown to the prospective buyer. An easement is a grant of a right to one party to use land, for a particular or general purpose. The existence of such an easement can make the property much less attractive to the prospective buyer.
Properly conducting a title search is very detail oriented and there is a high risk of missing something important. Therefore, it is recommended that the prospective buyer contact an attorney or securities firm to conduct the search on their behalf. Alternatively, he may take out a title insurance policy to cover any losses incurred as a result of human error in conducting the title search.
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