Many home buyers are so excited about their upcoming closing on a home for sale that details like the title search pass them by. In many cases, the title search goes on behind the scenes while buyers are busy having their homes inspected and getting homeowner's insurance arranged. To find out more about this can't-miss event, read on.
A Priority Event
You may hear your real estate agent mention the words "title search" soon after you've signed an agreement to buy a home. The title search process often begins very early on so that any issues that are found can be addressed and not hold up the closing. The title search is usually arranged by your agent, and it may even be accomplished by the same real estate company. A title search involves a thorough look back at the home's history using many different sources of reference. Any previous owners are identified and all sales records are examined in detail to determine the legality of any financial and sales transactions. Without a title search, you could end up thinking you own a home that really belongs to someone else. Proof of clear title is a must-have for your lender as well.
In most cases, searches are performed without finding any issues, but the older the property, the more likely it might be to turn up troubling issues. Take a look at some common title search issues:
- Property Liens – A lien is placed on a piece of real estate when the owners owe money. They might owe money to the government for taxes, back child support payments, unpaid bills, an unpaid contractor who worked on the home, and more. The home, unfortunately, cannot be sold until the lien is paid, or satisfied. If the current owner is unable to pay the debt that caused the lien, the home purchase could be in jeopardy. In some instances, the buyer will agree to pay the lien so the sale can proceed.
- Survey Issues - Part of buying a home is having a survey performed, and the results of that survey can tie into title searches as well. Home boundary lines can become blurred when others build upon or use part of the property as their own.
- Zoning – In some cases, the zoning for a nearby property has changed.
- Easements – A title search will readily identify how much of the property is given over to public use. That might include, for example, 6 feet of property off the road that is reserved for city or county use.
- Disputed Ownership – This problem could turn into a court case and may cause the entire deal to fall through.
Speak to your real estate agent to find out more about your title search.