If you’re interested in purchasing residential or commercial real estate, doing a property title search is an important step. Business and home title searches are essential to successfully buying and owning property anywhere in the world. Here are three reasons a property title search is so important.
What Is a Property Title Search?
A property title search involves searching for title records of a property. The search is done by a title company, who has access to public land and property records held by the county the property resides in. The search starts with the current owner and ends with the earliest owner. Once the search is complete, the title company will prepare either a preliminary title report or title commitment. These documents will show a description of the property; name of the current owner; and any liens, disputes, claims, deeds, and other foundational documents involving the property that were filed and recorded.
Doing a title search on the home or business you’re interested in buying can reveal if there are any ownership disputes. Property disputes can happen when a former owner or heirs have a legal claim to all or parts of the property. Other types of ownership disputes include business title fraud, home title fraud, and false claims. False claims are mostly the result of clerical mistakes during the filing process.
Sometimes, a previous owner will make a false claim using lies and other forms of deception. False claims involving willful deception is something you need to be especially careful about. Make sure you get all the information available on every claim being made on the property during the title search. This way, you can avoid getting caught in the middle of a long, expensive legal battle.
Title searches can help you receive business or home title protection against any unreleased liens on the property. A lien gives other people a claim on the house due to debts owed, including mortgages, unpaid taxes or loans, mechanic expenses, and other financial hindrances. The title of a property can only be transferred when all liens are paid off. The lien may not be released if relevant paperwork didn’t get filed or was improperly filed. Before you buy the property, make sure all liens are taken care of. A clear title means a smoother transfer of ownership for residential and commercial real estate.
An important part of a property title search is commercial and home title monitoring. If any documents are missing, incomplete, or inaccurate, then they won’t show up during the search. One reason for faulty information is clerical errors. Other reasons include the owner concealing information or forging documents. Whether you are interested in buying commercial or residential property, getting title insurance and an owner’s title policy will protect your investment.
Title insurance involves a one-time premium that protects you and your benefactors from financial losses due to defects in the property. The owner’s policy will cover any costs necessary to generate a clear title for transfer of ownership to you. This includes fixing documents and records with incorrect signatures, defects due to fraud or forgery, restrictions, and hindrances based on past or current legal judgments. You might also want to invest in home title lock insurance. This will protect your title from being stolen.