Content Written By: April Wilson, Ryan Winter LLC contributing writer
What Is a Title Search
A title search is the process of thoroughly checking through all the public records that involve a specific piece of property to determine ownership of the property and any claims against it.
Title companies around the country conduct these searches for many individuals, usually people looking to buy or sell a piece of property. This search, when completed, shows any claims against the property that need to be resolved before a transfer of title can be completed. This helps make sure a buyer doesn’t inherit debt connected to the property, or worse. “A clean title is required for any real estate transaction to go through properly,” according to Investopedia.
Each state has different laws and regulations around property ownership. Title companies in Florida and Jacksonville title companies specialize in understanding these laws and regulations. This is why it is beneficial to use a title company with real estate attorneys who can help define the legal jargon involved in legal paperwork filed concerning property.
What Are Title Professionals Looking For During a Title Search
Title professionals are searching for two main issues during an in-depth title search: liens and judgements on the property. The title company will then work to clear the lien or judgement before an official transfer of title takes place. Sometimes the lien or judgement is significant and will take time to clear, compromising the transaction.
A title company is looking out for a multitude of other public records while conducting a title search as well. This includes any outstanding taxes on the property, information on mortgages taken out on the property, any easements or special building restrictions that involve the property, property encroachment issues, and more. “The title company will examine public records — often going back 50 years or more — to look for past deeds, wills, trusts, divorce decrees, bankruptcy filings, court judgments and tax records that may be defective or outstanding,” the Washington Post reports in an article about common title problems the can affect a home closing.
Helping potential buyers understand exactly what they are buying, what responsibilities and restrictions are involved, and any potential risks referring to the title is the primary goal for a title company. This helps keep property titles clean, limiting potential legal issues down the road.
First American Financial Corporation explains that hunting through public records to search for documents with the pieces of information above is difficult and complex work. “This can be difficult because, depending on the jurisdiction, liens and judgments on a property may be filed a number of ways – by the name of the buyer, the name of owner, the street address, lot number, etc.,” First American Financial Corporation said.
Beyond The Title Search
A title company does more than look for issues with a title. Title professionals also work to solve some of the issues they find. US Patriot Title, a title company that services the Jacksonville area and other parts of Florida, has a team of attorneys who work to solve many of the common issues discovered to help continue the title transaction process.
The title team works to clear up small liens and judgements and also works to make sure the buyer understands the different building restrictions or easements related to the property. If there is an issue that is going to take too long to solve, the title team will make all necessary parties aware. This allows each party to look into the issue and make the best decision moving forward. Sometimes this means the transaction cannot take place. Title companies want to make sure a buyer is purchasing a clean title to prevent legal ramifications later.
In addition, most lenders will require a buyer to get an in-depth title search to make sure the buyer’s purchase and their investment is secure. Lender’s do not want their clients involved in a “dirty” title. They’ll want any issues cleared prior to closing. Lender’s will also require their client to get title insurance that at least covers the lender’s money.
Title insurance covers any possible missed recorded public records showing a claim, lien, or judgement against the property in question. The title insurance only covers claims, liens, judgements, building restrictions or easements that were recorded prior to the official title transfer. Anything recorded after that date is not covered under the title insurance. It’s important to note that there are two main types of title insurance policies. One to protect the lender’s interest and one to protect the new homeowner’s right to the title of the home.
Why Use A Team Of Title Professionals And Attorneys For A Title Search
It’s true — a title search is an extensive public records search. This means all the documents are available to the public. Anyone with the ability to go to the clerk of courts and property appraisers building, and in this day-in-age anyone with internet access, can go search for these documents on their own. So why pay for a company to do it?
Well, public records, as stated earlier, are filed in many different ways. It is a complex process to hunt down every piece of recorded data on a piece of property. To search through many different owners, builders, and other complex life happenings within each ownership, such as any work done on the home or property, government regulations imposed on the land, wills granting ownership to heirs, divorce records and more — all filed in different ways using legal documents and signatures — is an intricate process to say the least. In addition, many of the documents can be difficult to digest and require a lawyer’s help. For this reason, most lenders will require an in-depth title search to be conducted and insured by a professional title company before the closing can be completed.
Once all the documents are found, any issues discovered need to be evaluated and cleared. Many times this process also requires legal help. “Title companies report that in more than one-third of all real estate transactions they must undertake ‘extraordinary work’ to address title issues,” the Washington Post said.
US Patriot Title has a well rounded team of experienced Realtors, title professionals and real estate attorneys ready to help your clients have a successful closing.
