Property title search: What it is and how it works

Buying a house is an exciting milestone for many people, but it requires several legal steps – from making an offer to signing legal documents at a closing table – before you can officially become a homeowner.

Each step is a crucial part of protecting your future investment. One critical measure is to have a property title – or “home title” – search conducted to ensure the absence of any contested claims on who owns the property.

It’s worth exploring the importance of a property title search to see how getting one protects you and your investment in your new home.

What is a title search?

When buying a home, you’ll likely assume the seller is entitled to sell the property. However, that assumption can go awry if someone else with a claim or lien on the property knocks on your front door.

A property title search examines public records to confirm a property’s rightful, legal owner. A title search should also reveal any claims or liens against a property that may affect purchasing it.

Why do I need a title search?

Finding out who owns the property you want to buy is just the first step. The current owner may not even be aware of an old claim on the property’s title. A previous owner’s debts can become your responsibility because mortgage liens and similar debts – as well as easements and restrictive covenants – follow the property, not the owner.

Encumbrances such as unpaid property taxes, homeowners association (HOA) fees and unpaid bills for previous home improvements may become your responsibility if you skip the title search – or the title search fails to uncover it. That’s why mortgage lenders require a title search and title insurance as part of the mortgage underwriting process.

How do title searches identify who owns a property?

A title search digs into a property’s public records. Typically, an attorney or title company will use various legal documents to establish a chain of title and confirm that a seller is the rightful owner.

The process

The title abstractor is a professional who conducts the home title search by examining public records. They pull together all the relevant information and legal documents they can find on a property to prepare an abstract of title, which includes a recorded chronology of all available documents and transactions related to a property.

The abstract may include the current and previous owners, past property surveys, easements that cross the property, and any wills or lawsuits connected to the property.

The findings

A home title search can uncover financial rulings against the property’s owner that may affect you financially in the future. Some potential problems with the title may include outstanding property taxes, liens against the house and easements. Outstanding claims may threaten your happily-ever-after in your new home.

Your house title search must indicate clear and free ownership of the property, resulting in a “clean title.” A clean title shows that the homeowner has uncontested sole ownership of the property. Otherwise, you may be in for a rude awakening down the road.

If the title search uncovers a filing problem such as a misspelled name, or the search reveals larger obstacles such as unresolved building code violations, the title is referred to as “dirty.” In this case, the home buyer can attempt to resolve any outstanding issues with the seller or move on to another property.    

Title insurance

You can mitigate the potential risk of a claim on a property’s title after purchasing a home. For example, you can purchase title insurance or secure a warranty of title. The one-time purchase of a title insurance policy can help protect your ownership claim to the property if an issue comes to light, making the expense (usually 0.5% – 1% of a home’s purchase price and folded into your closing costs) worth the price for many home buyers.

Who conducts the home title search?

A title company or attorney typically takes care of the title search. In some cases, a lender or home buyer may conduct the title search.

If you tackle the title search yourself, you can find the records you’ll need at places such as the county courthouse, recorder’s office and assessor's office.

It may be a good idea to let the professionals – such as real estate attorneys – handle this part of the home buying process. Legal documents can confuse the untrained eye, causing you to overlook or misunderstand something important.

How long does a title search take?

The speed of a title search will vary based on the complexity of the documents associated with a property, but a title search typically takes about 2 weeks to complete.

A title search will involve obtaining records from multiple sources, which can delay the process if an office takes a long time to respond. Once the documents are in the hands of the title company examiner or attorney, it may take a few hours or weeks to review all of the paperwork and uncover any outstanding claims.

Old vs. new homes

If you’re unsure about buying an old house versus a new house, some considerations are important to keep in mind as you start the title search process. A newer home typically has fewer documents to research than an older home. An older home will likely have more records to review because it’s been on the market longer, perhaps prolonging the title search.

Although waiting can be frustrating, it’s not a good idea to rush your attorney or title company examiner. Allow them the time they need to do their job thoroughly so they can help you avoid any future issues with the home.

How much does a title search cost?

The cost of a title search is generally $75 – $200, but it can vary based on the state you’re purchasing in. At the end of the investigation, you should receive an easy-to-follow report on the documents connected to the property. You should also have access to highlights of any encumbrances you’ll need to resolve before moving on with the purchase.

Though you can do it yourself, it may be best to leave a title search to the professionals and simply budget for the cost of title fees.

The bottom line: The results of a title search can impact a home buyer’s plan

A title search is a key part of the home buying process. If you know how a property title search works when the time comes to get one, you can correctly interpret the results of the search and know how to best proceed based on those results.

Start the home buying process with Rocket Mortgage^®. We’ll help you navigate every step of the journey – including the title search.