If you’re looking to buy a home, there are certain preliminary steps you should take to ensure you are making the correct decision. One of the most important precautions to take when purchasing a new home is the completion of a property title search.
A property title search is the process of retrieving documents evidencing events in the history of a piece of real property. The purpose of this process — which is generally completed after an offer to purchase a property has been accepted — is to establish relevant interests in the property and any regulations relating to it. A title refers to a legal document (like a deed) that establishes legal ownership of a property in someone’s name. Among the sources searched as part of this process are county land records, federal or state tax liens, divorce or child support cases and bankruptcy court records. One of the first steps to performing a title search involves securing a legal description of the property, which is often found on a tax statement.
An Ownership and Encumbrance report is then typically filed. This report is made up of records that state whether or not the property in question is free of liens or pending lawsuits, and if the seller is accurately representing title ownership. If there are no claims or lawsuits against a property during a sale or transfer process, then the title search is considered ‘clean.’
Property title searches are important for prospective homeowners to perform not only because they determine who legally owns a property, but also because they ensure all existing liens, loans, child support and judgments are disclosed and handled before the close of escrow.
Benefits Of Performing A Property Title Search
There are many advantages to performing a title search through a reputable title company. As a homeowner, this process can help you:
Discover property liens: These are any types of legal claims on assets that allow the holder to gain access to a property if there are any outstanding debts. Liens can include money due to taxes via a tax search. This will help you minimize delays and potentially save you a lot of money. If a property lien for unpaid taxes is recorded and the sale is approved and carried out, a local government agency could try to foreclose on the home.
Discover mechanics liens: These are liens issued for unpaid services related to renovations on a property performed or licensed by subcontractors and suppliers.
Discover any credit card debt: possibly attached to the home.
Research unsatisfied judgements: This process can be carried out against either the seller or previous owners via a ‘name and judgement search.’
Perform a comprehensive inspection of the title:A full, proper inspection of a home can help mitigate encroachments, which occurs when a homeowner violates his neighbor’s property rights by building on or extending a structure to the neighbor’s property.
Research the chain of title: This process involves looking at the series of historical transfers of a title or property by examining public documents to ensure that the current owner is legitimate and has not falsified any information (title fraud).
Finally, a crucial part of performing a property title search involves conducting due diligence on your future home. This means shopping around to explore various options, consulting with a lender to see if you can be approved for a mortgage loan, looking into home insurance and becoming familiar with your neighborhood. Title insurance will also protect your future financial situation, as this covers potential claims that could arise out of unrecorded issues with a property title after the sale is completed.
Seeking Help With A Property Title Search
Speak to the professionals at Mathis Title Company in Fairfax, Virginia for guidance on how to perform a property title search. Robin Mathis is an attorney with more than 35 years of experience in real estate settlement services. She has performed thousands of closings, both residential and small commercial, and deals with both the buyer and seller sides. To help you obtain title insurance and ensure that the title being transferred during the closing process is clean, Robin will conduct proper research on your title and will then recruit trusted underwriters to insure your new title with an owner’s policy and lender’s policy. This will protect you (the homebuyer) against any transfer-of-ownership-related issues that may arise.
Other services Mathis offers include contract preparation and review, mechanics lien and agents services, refinancing and settlement. Call Mathis today or contact them online for an initial free consultation.