Title Search & Insurance

What is a Title Search?

A title search is a detailed examination of public records related to a property's history. This process is conducted to verify the legal ownership of the property and to uncover any potential issues that could affect the transfer of ownership.

• Public Records Examination: The title search involves reviewing records such as deeds, court records, property tax records, and other documents that provide information about the property's history.

• Verification of Ownership: The goal is to confirm that the seller has the legal right to transfer ownership of the property to the buyer.

• Identifying Issues: The title search aims to identify any liens, encumbrances, or other claims against the property that could affect the buyer's ownership rights.

Common Issues Found During a Title Search

Several issues can be uncovered during a title search, including:

• Liens: Claims against the property by creditors for unpaid debts, such as mortgages, taxes, or contractor fees.

• Encumbrances: Legal restrictions or claims on the property, such as easements or covenants, that may limit the use of the property.

• Errors in Public Records: Clerical or filing errors that could affect the property's title.

• Unknown Heirs: Potential heirs who may have a claim to the property but are not listed in the current ownership records.

• Fraud and Forgery: Instances where the property has been fraudulently transferred or documents have been forged.

What is Title Insurance?

Title insurance is a policy that protects the buyer and the lender from financial losses due to defects in the property's title that were not discovered during the title search. There are two main types of title insurance:

• Lender's Title Insurance: This policy protects the lender's interest in the property. Most lenders require this insurance as a condition of the mortgage.

• Owner's Title Insurance: This policy protects the buyer's ownership rights. While it is optional, it is highly recommended to safeguard your investment.

Benefits of Title Insurance

Title insurance provides several key benefits:

• Protection Against Hidden Risks: Covers issues that may not have been discovered during the title search, such as forgery, undisclosed heirs, or errors in public records.

• Legal Defense: If a claim against your property arises, title insurance covers legal fees and court costs to defend your ownership rights.

• Peace of Mind: Ensures that you have clear ownership of the property and can enjoy it without the fear of future title disputes.

The Title Insurance Process

Obtaining title insurance involves several steps:

• Title Search: The title company conducts a thorough title search to uncover any issues.

• Title Examination: The findings from the title search are reviewed, and any issues are addressed.

• Issuance of Title Commitment: The title company issues a title commitment, outlining the conditions that must be met before the policy is issued.

• Clearing Title Issues: Any identified issues must be resolved before closing.

• Policy Issuance: Once the title is clear, the title insurance policy is issued, providing coverage to the buyer and lender.

Costs of Title Insurance

The cost of title insurance varies based on several factors, including the property's value and location. It is typically a one-time premium paid at closing. However, in most states the cost of title insurance is standardized regardless of which title company you work with to provide the policy.

• Lender's Policy Cost: Usually based on the loan amount.

• Owner's Policy Cost: Based on the purchase price of the property.

• Discounts: Some title companies offer discounts if both policies are purchased simultaneously.