When you purchase property, you typically need to pay for a title search. This process searches all the records associated with the real estate to look for liens and confirm ownership.
Unfortunately, you cannot assume that the seller has the right to sell the property, and although title insurance can protect you after closing to some extent, you should pursue a full title search. These are reasons you should consider.
Confirms ownership
A title search looks for any breaks in the title’s ownership chain. It looks for anyone who sold the property without having the right to do so. Buying the property with the break can impact your ability to sell it later and may result in legal action against you for the return of the property to its rightful owner.
Searches for easements
Local governments, organizations and individuals place easements on real estate for a number of reasons. For example, an easement may allow your neighbor to access his or her property, leaves space for a future road or prevents encroachment or guests of another’s property from using yours. Easements may also block development to retain light and view access.
Looks for liens
Mechanic, creditor or judgment liens on a property can impede its sale. The current owner needs to clear or pay off these liens before you purchase the real estate or you may have to pay them.
Identifies zoning
Zoning is important because it tells you what you can do with a piece of real estate. For example, zoning could prevent you from subdividing the property or having a home-based business.
Real estate is an investment, and as such, you should do everything you can, including getting a title search, to protect yourself and the money you invested.
