How Does The Title Search Process Work
1. Initiation of Title Search: This process begins when a buyer or a lender requests a title search for a specific property. This is often done during a real estate transaction, such as when a home is being purchased or refinanced.
2. Examination of Public Records: A title company, attorney, or agent will examine public records associated with the property. These records include deeds, court records, property and name indexes, and other documents. The goal is to establish the history of ownership and to identify any claims, liens, easements, or other restrictions on the property.
3. Identification of Potential Issues: During the search, the examiner looks for any potential issues that could affect the title. These might include unpaid taxes, unsatisfied mortgages, judgments against the property owner, easements, and restrictions or covenants limiting the use of the property.
4. Creation of Preliminary Report (Prelims): Once the search is completed, the title company produces a preliminary report. This report outlines the current status of the title and lists any issues or defects that were discovered during the search. It includes information such as the property’s legal description, the current owner’s name, the type of title, liens or other encumbrances on the property, and any conditions or restrictions.
5. Review and Resolution: The buyer, seller, and lender review the preliminary report. If there are issues identified, steps are taken to resolve them before the closing. This might involve paying off liens, resolving boundary disputes, or addressing any legal issues that have been uncovered.
6. Issuance of Title Insurance: Once any issues are resolved and the transaction is ready to proceed, the title company will issue a title insurance policy. This policy protects the buyer and the lender against any future claims or legal fees that might arise from disputes over the property’s title.
7. Closing: With the title clear and a title insurance policy in place, the real estate transaction can proceed to closing.
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