Understanding the Title Examinations Process and its Impacts on Real Estate Ownership
May 05, 2023
Owning a home may be one of the most important investments of your life, so it's essential to have a clear understanding of the title examinations process. Title examinations are a crucial legal process which helps ensure that the real property you are about to purchase is free of any legal encumbrances. Through the title examination, a title examiner will review a variety of documents, such as deeds, mortgages, outstanding debts and liens, to ensure that the title is valid and that no claims are present that could prevent the transfer of ownership.
A title examination typically begins with an initial search of public records, such as county records, tax records, and deed registries. This search will reveal the current owner of the property, any outstanding claims on the property, and any unpaid taxes or liens associated with it. The examiner will then review the title against any legal questions that may arise about its validity. This includes matters such as:
- Boundary disputes
- Any other potential encumbrances that may affect the title
- Determining if the title is in compliance with any applicable zoning laws or other local regulations
Once the title examination is complete, a title insurance policy will be issued. This policy provides financial protection against any potential title defects or liens that were not identified during the title examination. This coverage is typically in the form of a one-time premium paid to an insurance company. The policy will cover any claims arising from title defects or liens that were not found during the examination process. In some cases, the title insurer may also provide additional coverage for any environmental liabilities associated with the property.
The title examination process is an important step in ensuring a smooth transfer of ownership for real estate owners. It helps to ensure that the title is free of any defects or encumbrances, and that the new owners will have clear title to the property. Title examinations can also provide peace of mind that the legal process has been completed properly and that the title is valid. In addition, title insurance provides added protection against any claims or liens that may arise after the title has been transferred. With a thorough title examination, a real estate owner can be confident that their investment is secure.