Why do title search

The title commitment is like a road map for a title agent in the transaction. It shows everyone involved in the transaction exactly what needs to be fixed, what will be covered, and what will not be covered by the title insurance policy.

In addition to a title search, another important role provided by the title company or law firm is holding escrow. Escrow is when a neutral party creates an account to hold the money involved in a real estate transaction.

The title company makes sure that the conditions of the contract between the lender, seller, and buyer are met before the money or title is transferred to another party. Homebuyers working with a real estate agent should ask about recommendations for a local title company. Asking those who recently purchased a home is also a good place to start.

You should also be sure to research the company. Some agencies are specialized in commercial and not residential or refinances and not resales, so make sure the company you choose is a good match.

Also, be sure to shop around for the best premium rates in your region. Depending on the real estate contract that you negotiate, you may be limited in your choice of title company. You can also choose to work with a real estate law firm instead of a title company. Amanda Farrell is a digital media strategist at PropLogix. She enjoys being a part of a team that gives peace of mind for consumers while making one of the biggest purchases of their lives. She lives in Sarasota with her bunny, Buster, and enjoys painting, playing guitar and mandolin, and yoga.

Back to the Blog. Amanda Farrell 2 years ago. A title search will answer three important questions about a property: Does the seller have a marketable title meaning can they sell the property free and clear?

What kind of restrictions or allowances are imposed on the property? Do any liens exist on the property that require payoff at closing? Once the title is deemed marketable, the title company will issue a title insurance policy. A title company has access to detailed property records The process of a title search typically begins with accessing the public land records held in a centralized government office.

Conditions to the Title Commitment are requirements that must be met before or at closing, and they include: The seller paying off his or her mortgage Payment of all recorded liens against the property at the time of sale Release of all liens, judgments, HELOCs, lis pendens officially recorded after the closing It will also highlight what current title defects need to be cleared before a marketable title policy can be issued.

A title company acts as an intermediary between the buyer and seller In addition to a title search, another important role provided by the title company or law firm is holding escrow. Here are the top 5 reasons why this step should not be overlooked.

The first and foremost reason to have a title search performed is to validate that the current sellers are in fact, the true owners of the property. You will also be able to see how many times the property has changed hands. It also will produce any other names that are connected to the home…like an uncle or aunt who might have co-signed back in the day and have never been removed from the title.

The last thing you want to find out once you move in is that someone else is still connected to the property and can have a say in your ownership. Having a survey as well is a great way to see for yourself the actual build site and where the property lines are. Another important reason a title search is performed is to find out if the house has any bylaws registered to it.

Title searches are necessary not only for issuing title insurance but also for closing on the property — completing the purchasing process. Any outstanding issues must be satisfied and removed before closing can take place. Different ways to title a property include tenants in common, joint tenants, right of survivorship, or a life estate.

Also, since a piece of land can be used for many purposes, the owner of the property itself may not hold title to the mineral or utility rights. Since there are so many things that can go wrong with property ownership — liens for unpaid taxes or loans, easements claimed by the city, errors in recording, for example — title insurance protects the property owner from a later discovery of these issues.

Whereas the typical insurance policy, such as homeowner's or automobile insurance, covers events that take place after the policy is issued, title insurance does the opposite. It covers events that have taken place before the policy is issued. All insurance companies need to minimize their risks when issuing policies, and a title search is the title insurance company's way of doing so.

Title insurance is a relatively inexpensive, one-time fee.