Title search Totally Explained

Everything about Title Search totally explained

A title search is a process that's performed to determine the answers to two questions.*Does the seller have a saleable interest in the property?

Do any liens exist on the property which need to be paid off at closing (mortgages, back taxes, mechanic's liens, or other assessments)?

A title report also shows any easements, or recorded legal rights to the property or portions of the property. For example, a previous owner may have legally given a neighbor the right to share the driveway, or the city may have a right to strips of the property for putting power lines, communication lines, water pipes, or sewer pipes.
   In the United States, the buyer of a property will usually purchase title insurance, which protects the buyer from any title problems that may arise after sale (such as liens that were missed during the search). The title insurance company issues a report and issues an insurance policy in support of its findings.
   A title search is also performed when an owner of a certain real property wishes to mortgage his property and the bank requires him to insure their transaction.
   Generally, there are two main types of title searching, a full coverage search and limited coverage search; other types include non-insured reports and foreclosure guarantee search.

Full coverage search

A full coverage search is usually done when creating a title report for sale/resale transactions and for transaction that involves construction loans. It generally includes searches related to property lien, easements, CC&Rs Covenants, Conditions and Restrictions, agreements, resolutions and ordinances that will affect the real property in question.

Search for liens against the owner and the other parties on title.

Search for liens against the buyer (for sale transactions only).

Search for Bankruptcy proceedings against the owner of the property.

Limited coverage search

A limited coverage search is usually done when making title reports for refinance transactions that involves ownership equity loans and for making simple title guarantee reports.
This kind of title searching usually includes searches for property liens, liens against the owner and the other parties on title and search for bankruptcy proceedings against the owner of the property.

Non-insured reports

There are a variety of title searches which provide the customer with a report, but no insurance. These are for informational purposes only, and are called by a variety of names, such as Lot Book Report, Plat Certificate, 300-foot Radius Report, and others. These informational searches are used mainly in two instances:

Probate. This is when a family, lawyer, or court is dividing up the property of a deceased person. Heirs will want to know what liens they're taking on and who has rights to the land.

Subdividing. To create a subdivision, a person takes land previously platted (legally named and recorded) under another name and renames and replats it as a new development or subdivision. A report must be given to the city, showing taxes paid and no liens. The owner can then sell the lots individually or en masse, and may record Covenants, Conditions, and Restrictions, which govern how residents may construct their houses or yards, and may limit other activities. Many subdivisions have noise, pet, and trash laws as well.

Foreclosure Guarantee Search

A foreclosure guarantee is a type of report (for example Trustees Sale Guarantee, Judicial Foreclosure Guarantee and Litigation Guarantee) that's used mainly for foreclosing an encumbrances (or a lien) in a certain property. The title searcher will perform a full coverage search to the property in default and a search for the addresses of the lien holders to the property in default. The addresses will be used for sending copies of the notice of foreclosure letters (such as Notice of Trustees Sale, etc.) to the lien holders to the property in default.

Further Information

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