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Property Title Search: What It Is And How It Works

Sarah Sharkey4-minute read

September 16, 2020

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Buying a home is a major purchase for anyone. Since your home may be one of your largest assets, it’s important to carefully consider whether or not this purchase is in your best interests.

A few of those critical steps include obtaining an inspection, having the home appraised, and conducting a property title search. Today we’ll take a closer look at the property title search and how it can protect your home purchase.

What Is A Title Search?

When you’re buying a home from a seller, you’d likely assume that the seller is entitled to sell the home in question. However, that assumption can lead to heartbreaking consequences if someone else with a claim or lien on the property shows up on the doorstep.

A property title search is a probe into the public records on the property to confirm the property’s rightful legal owner. Plus, the title search will reveal if there are any claims or liens on the property that could affect your purchase.

How Do Title Searches Work?

A title search digs into the public records available for the property in question. Typically, an attorney or title company will use a variety of legal documents to confirm that the seller is truly the rightful owner. Beyond that, the title search will root out any other financial and legal claims on the property.

The person conducting the title search can be called an abstractor. The abstractor works to pull together all of the relevant information and legal documents that they can find about the property to create an abstract of the title. The abstract of title will include a recorded chronology of all available documents and transactions related to the parcel of real estate in question. That could include the current owner, the previous owners, past surveys of the property, any easements that cross the property, and any relevant wills and lawsuits that involve the property.

The findings of a title search could include any financial rulings against the owner of that property title which could affect you financially in the future. A few examples include any outstanding property taxes, any liens against the house, or easements of any kind. If there are any outstanding claims on your property, that could bode badly for your happily ever after in this new home.

It’s critical that your house title search shows clear and free ownership of the property. Otherwise, you could be in for an unpleasant surprise down the road. Luckily, there are ways to mitigate the potential risk of a claim on your new property’s title. You can purchase title insurance or secure a warranty of title. The one-time purchase of a title insurance policy can protect your ownership claim of the property, so it’s worth considering the expense.

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Who Does The Title Search?

A title company or attorney will typically take care of the title search. In some cases, the lender or the individual home buyer may take over this process instead.

If you choose to tackle the title search process on your own, then you can seek out the records you need at places like the county courthouse, the recorder’s office, and the county assessor office. However, it might be a good idea to let the professionals handle this part of the homebuying process. Legal documents can get confusing to the untrained eye and you don’t want to accidentally look over something important.

How Long Does A Title Search Take?

The speed of a title search will vary dramatically based on the complexity of the documents surrounding the property in question. A title search will involve obtaining records from multiple sources which can slow down the process if an office is slow to respond.

Once the documents are in the hands of the title company examiner, it could take a few hours or a few weeks to pour over the documents for any outstanding claims. Typically, a newer home will have fewer documents to go through and result in a faster process. An older home may have more records that need to be reviewed and prolong the process.

Although it can be frustrating to wait, you shouldn’t rush the title company examiner. You want them to do their job as thoroughly as possible to prevent any issues in the future.

Cost Of A Title Search

In general, the cost of a title search will range from $75 – $200. The price can vary based on the state you’re purchasing a property in, but that’s a good estimate. At the end of the process, you should receive an easy-to-follow report on the documents connected to the property and the highlights of any encumbrances that could create an issue if you move forward with the purchase.

Of course, you can dramatically reduce the cost of a title search by conducting it yourself. However, the importance of a title free of any outstanding claims is absolutely critical. It might be a good idea to leave this step to the professionals and consider the cost as necessary to moving forward with your home purchase.

The Bottom Line

A title search is one key piece to the home buying process. However, it’s not the only part of the process that can be confusing for a home buyer. The best way to feel more comfortable with your home purchase is to understand the ins and outs of the process. With more knowledge, you’ll be able to move forward at your own discretion knowing that the purchase is still in your best interest.

Take action to learn more about the process of buying a home. Make it a priority to understand the steps so that you can move forward confidently into your dream home!

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Sarah Sharkey

Sarah Sharkey is a personal finance writer that enjoys helping readers learn more about their finances. She has an MS in Business Management from the University of Florida. You can connect with her on LinkedIn or Instagram @adventurousadulting.