What is a Title Search Service?
In real estate and law, a title or property search service is the process of retrieving documents. This is to evidence events in the history of a piece of real property. All to determine relevant interests in and regulations about that property.
What kind of restrictions or allowances pertain to the use of the land? These would include real covenants, easements, and other fair servitude. Do any liens exist on the property which needs paying off at closing? These would be mortgages, back taxes, mechanic’s liens, and other assessments. A title search is also performed when an owner wishes to mortgage property. The bank requires the owner to ensure the transaction.
Anyone may do a title search, with the right knowledge and resources. Documents on conveyances of land are a matter of public record. These documents are in hard copy paper format or sometimes scanned into image files. The information within the documents is not available as a data format. The records are descriptions of legal events. They contain terms, conditions, and language more than data.
Generally, there are two main types of title searching. A full coverage search and limited coverage search. Other types include non-insured reports and foreclosure guarantee search.
Why Choose a Title Company?
Often people choose a title company or attorney to conduct an exhaustive search. Performing a title search involves accessing the land records for the subject property. Each record is a document evidencing an event which occurred in the history of the property. A deed records an event of property transfer. A mortgage documents the collateral interest of a home loan. A lien documents a claim against the property in favor of another, such as a creditor, vendor, or tradesman. The goal of the title search is to establish clear, marketable title. All by exposing any outstanding claims before a transfer of title.
Each recorded document must name the parties involved, e.g., grantor and grantee. The grantor is the party transferring away from a property right. The grantee is receiving a property right. In the case of a deed, the grantor would be the property seller, and the grantee the buyer. A mortgage grantor or mortgagor is the borrower of the loan. They are giving away certain property rights to the mortgagee, lender, or grantee. More recent wording simplifies this language with “Borrower” and “Lender.”
The records are in a centralized government office. Usually at the county courthouse. This is in states with strong county governments such as Washington or Massachusetts. The title on the door would be something like Registrar of Deeds or County Recorder. In municipal offices (in small states such as Connecticut, Vermont, and Rhode Island). Often the title searcher must go to each individual town or county office to research the title.
A title search begins with searching for and retrieving each physical contained document. Every recorded document is by date in a special set of volumes. These volumes are by names such as Grantor-Grantee index, Land Records or Deed Records. These may or may not be digital or scanned into a searchable file. This depends on the financial resources of the county or town. An official stamp located at the bottom of the first page. It gives the name of the recording official, date, time, book and page number. If the document is on record, this stamp will ALWAYS be there.
The documents are then reviewed and analyzed to see how each affects the property. Contingent conditions within documents may exist within the document language. This process is often performed by a trained professional called a title abstractor. Some title abstractors have certifications. These certifications document their experience level and training and have passed an exam.
The document produced by a title abstractor is a title abstract or abstract of title. This is not a document which exists in public records, but it derives from recorded documents. The title provides to the title company, attorney, or end-user by the abstractor.
A title report may show any easements or encumbrances against the property. A previous owner may have given a neighbor the right to share the driveway. The city may have a right to strips of the property. Rights for putting power lines, communication lines, water pipes, or sewer pipes. A few online services offer title searches for little cost. Their accuracy is not inferior to what a title company or attorney will offer. But, online businesses rely on available information. For that reason could at times limit both incompleteness and geographical availability.
Full Coverage Search
- Search for liens against the owner and the other parties on a title
- Against the buyer (for sale transactions only)
- Search for Bankruptcy and Judgement proceedings against the owner of the property
- Against the buyer is not something that covers a title search
Limited coverage search
A limited coverage search makes title reports for refinance transactions. These involve ownership equity loans and for making simple title guarantee reports.
In the United States, the buyer of a property will usually buy title insurance. This protects the buyer from any title problems that may arise after a sale. Such as missed liens during the title search. The title company issues a report and an insurance policy in support of its findings. But, title searches are most often carried out before completed contracting between parties. Sometimes even during the escrow phase of a closing.
To create a subdivision, a person takes land before platted. Named and recorded under another name. Also renames and re-plats it as a new development or subdivision. A report must go to the city, showing taxes and liens paid. The owner can then sell the lots to an individual or en masse. They may record Covenants, Conditions, and Restrictions. This governs how residents may construct their houses or yards. This may limit other activities. Many subdivisions have noise, pet, and trash regulations as well.
Foreclosure guarantee search
A foreclosure guarantee is a report that uses foreclosure encumbrance in a property. The title searcher will perform a full coverage search to the property in default. The addresses are for sending the notice of foreclosure letters to the lien holders to the property.
Property title search before a foreclosure sale
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