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When you enter the real estate world, be it for selling, purchasing, or renting property, you will come across many terms you might not have heard before. This may especially be the case if you’ve never lived on your own.
Most people get confused about whether or not there’s a difference between property titles and property deeds. They are two different concepts. A property title report is one of the most critical documents in the home buying and selling process. Here is everything you need to know about property title reports.
The property’s title is the legal document that shows who legally owns the property. This document along with making up the property’s title report. Whoever holds the title has all legal rights to the property.
Note: A legal description is a unique identifier. It usually contains 2 or 3 short paragraphs which accurately pinpoint where a particular property is located. It also contains parameters such as lot features, lot number, total acreage, parallels, meridians, etc.
There are several ways a title report for property can be held:
The Title Report real estate should not contain the following errors, as they may hinder the transfer of ownership when the property gets a new buyer.
The Most Common Issues in the Title Report Include:
You may conduct a title search on your own if you want, but it’s usually not recommended. It’s worth the investment to have an experienced title officer or title company prepare the report on your behalf. They know what information to look for and from where they can find such information. Typically, sellers provide preliminary title reports, but buyers should complete the title report for a property as well.
A significant source of title report real estate information is the public record. You should be able to locate basic information about the property, such as:
A title search identifies who the legal property owner is. It also provides information about whether there are any lingering financial liabilities tied to the property (i.e. unpaid contracts, liens, mortgages, or judgments) that need to be cleared before the property can transfer to a new owner.
The fees to conduct a title search will vary depending on the property, but can generally cost between $100 and $200. Usually, the cost for a title search is included in the closing costs when a property is sold.
The length of time can vary depending on the transaction type and property, but it usually takes approximately a week. Your title officer or real estate lawyer can provide you with updates as the closing process progresses.
You’ll need to solicit the help of a title company to order a title report. Any title company should be able to retrieve the requested title. Search “property title report” or “title report real estate” using your favorite search engine or look under “title search” in the Yellow Pages.
If you prefer to pull the title on your own, you should start your search at the local courthouse or County Assessor’s office where the property is located. Public records are maintained at these places, so you may find a great deal of information on the property. However, keep in mind that the courthouse may not have all the documents you need for the complete title report.
Many people use “title” and “deed” interchangeably, but they are two different concepts. A deed is a legal document used to transfer property ownership from one person to another. In contrast, a title clarifies the ownership of a property and can be used to transfer this ownership to someone else.
Before I move on to answer the question, it is worth reiterating that the safest and easiest way to conduct a title search is to hire a title company’s services. A title company will assign a title officer to your request, and that person will complete all the research related to the property on your behalf. You’ll also have the added advantage of getting title insurance if you work with a title officer.
However, if you are determined to conduct your own title search, the first thing you need to do is to visit the nearest courthouse. Ask the clerk for assistance with locating and researching the property records on file. It is often hard to navigate the sea of documents, and it can be time-consuming for someone unfamiliar with the filing system.
Once you find the relevant documents, review everything in the documents regarding prior ownership. Pay special attention to notes about past transfers of the title. Be conscious of anything that may look suspicious or that doesn’t make sense. You may have to make an additional trip to the County Clerk or the County Assessor’s office to look for the deed information. It may be time-consuming, but running a tile report on your own is completely free.
A preliminary title report is a document that documents the property owner(s). It also contains information such as property liens or tax debts on the property, a detailed description of the property, and if you can use it only for residential purposes or for commercial purposes as well.
In addition, it allows buyers to remove any items in the report that the buyer finds unacceptable before actually purchasing the property.
Typically, the listing agent is the one who is responsible for providing the preliminary report. What happens is that the title company or an attorney reviews the property’s title to identify any problems that could prompt someone to dispute ownership or that could make it an illegal sale. Their conclusion is added in the preliminary report, which then goes to the buyer.
A title report must contain mortgage liens which are shown in descending order. The largest value is shown at the top. Another field of information is property tax information. This will let you know whether or not there are any taxes owed on the house. Before you buy a property, make sure that the taxes are paid.
There will be additional information in the title report, but pay special attention to these three parts of the title report.
Title insurance gives the owner protection against any issue that may arise related to the property’s legal ownership.
There are Two Different Types of Title Insurance:
Lender’s insurance protects the lender that finances the property purchase. Similarly, owner’s insurance protects the buyer from any ownership disputes. For example, if you buy a property and someone else claims ownership of the property later and can prove it, you will receive money totaling the home’s value.
It is always a good idea to protect yourself even if you don’t foresee there being ownership issues with your property. If you are already working with a title company or title officer, title insurance will be offered to you when you receive a copy of the preliminary title report. When you buy a property, it’s a lifetime investment, so it is important to protect yourself against any potential issues.
The best solution is to ask your network — family members, friends, or colleagues — for referrals. You’ll be able to get their feedback about the company’s professionalism, prices, and turnaround time for getting your report. You can also explore some of the title companies that come up during your online search. Read the customer reviews about the company and use them as a basis for selecting a title company.
A title report is an important document in selling a property, so don’t compromise on getting it handled by a professional who will get the job done right. You might be tempted to work with the first company you see or the one which costs you less; just do your due diligence in researching companies and review all your options. Feel free to ask as many questions as needed before you begin working with them on your title search.
Whether you are a seasoned investor or a first-time homebuyer. You should investigate what you are getting into when purchasing a property. This is the very reason why the title report is so important. It tells you virtually everything about the property you intend to buy. Consider the above questions thoroughly as you embark on your quest for your next property title report.