When you’re buying a house, it’s often one of the most exciting times in your life. It can also be stressful and overwhelming because there are a lot of steps in the process to get to the closing.
One of those steps is called a title search.
When you buy a home, you probably inherently think that the seller is entitled to sell the property. That’s not always the case, though. There could be someone else with a claim or a lien on the property you want to buy.
That’s where a property title search is relevant.
What Happens During a Title Search?
If you’re going to buy a home, then a title search is a way to go through public property records and confirm the legal, rightful owner of said property. A title search should also uncover whether or not there are liens or claims on a property that can ultimately affect you buying it.
A property title isn’t the same thing as a deed, nor is it a document.
Instead, the title is a reference to ownership rights as a concept.
A title company or an attorney can do a property title search. They are making sure there’s not another entity or person who could come forward and claim a stake in the home.
If you’re getting financing, then a title search is required. A mortgage lender will make you get one before they fund your loan.
Who Does a Title Search?
As was mentioned, a title loan company can do a title search, or an attorney can do it. Where you’re buying a home plays a role in who ultimately does the search.
Once a contract is signed, then as a buyer, your attorney might order the title search. Then, that attorney could complete it, or they might pass the work onto a title company. The completed report then goes to the seller’s representative. The seller’s representative has to take on the role of managing and dealing with any issues that might arise.
There are a lot of sources of information that might be accessed during a title search, including:
• County land records
• Property plats
• Tax liens at the state and federal level
• Divorce records
• Bankruptcy court records
• Construction liens
When a title search is done, it will also uncover details about mortgages associated with the property.
How Long Does it Take?
A title search might take a few hours, up to a few weeks. The older the home that you want to buy, usually the longer the title search will be because there might have been multiple owners and transactions that involved the property.
What If There Are Issues?
Some of the common issues that can come up during a title search include:
• A break of chain in the title: In this scenario, there might be a missing deed in the chain. This is common in older homes.
• An improper description on the deed: There might be an improper or missing description on a deed, and that would require obtaining a corrected deed.
• Missing interests: If there’s a transfer via an estate in a title chain, then any heirs must have relinquished their interest in the property. If they haven’t, then you have to get deeds from the parties with an interest to release it.
• Liens: This is a legal claim or right on a property often used as a way to get repayment for a debt. Title searches can show if there’s a lien on a property and whether or not it might be expired or could be something requiring payment.
The big takeaway with a title search is that it’s one important component of the process of buying a home. If you have questions about what happens during a title search or the results, you should speak to your Realtor or your attorney.
If you don’t discover something like a judgment or lien before you close on a home, it could be expensive and stressful to deal with the situation later on. For example, if there’s a judgment against a home and you end up buying it, it can become your obligation.