Title Examination:
Title examination is the process of researching and reviewing the ownership history of a property to ensure that the property is free of any liens, judgments, or other encumbrances.
This helps establish the title condition and to identify any problems that must be resolved before closing on the property. This helps to ensure compliance with all applicable laws, regulations and ordinances.
A title examiner will inspect public records, such as mortgages, judgments, liens, deeds, and other documents related to the property, during the title examination.
They will check for outstanding taxes or debts and examine the title chain to confirm that the seller is the correctful owner.
The title examiner will also check for other issues such as easements or zoning violations that could impact the property’s use or value.
The title examination report summarizes all findings and provides a detailed analysis on the title condition.
The buyers, lenders and insurers can use this report to help them make informed decisions about whether to purchase the property.
Reasons
Protection of your investment:
Title examinations can protect your investment in property by ensuring that there are no hidden problems that could affect its value or ability to be used.
Title insurance provides additional protection in the event that any title issues are discovered after purchase.
You should ensure that you hire a qualified and experienced title examiner for the examination and to obtain a title insurance policy to protect and invest.
Compliance with State and Local Laws:
Title examination ensures that the property transfer is in compliance with all state and local laws, regulations and ordnances. This helps to avoid legal issues and penalties in the future.
Compliance with state and local laws is important for many reasons, including avoiding penalties, legal liabilities, and reputational damage.
When purchasing a property, it is important to be aware of and comply with all applicable state and local laws, including zoning laws, building codes, and environmental regulations.
Identification of Hidden
This information can help you make an informed decision about whether or not to proceed with the purchase.
Uncovering Potential Fraud:
Title examination can also uncover potential fraud, such as forged deeds or fraudulent transfers. This can help to protect you from becoming the victim of a scam.
Details About Your Rights Over the Property
An assessment of the title will reveal which rights your client will have with respect to their new home.
These rights include the exclusive right to own the property, the right of accessing it and the right, if desired, to divide or modify the property.
Let’s say there is an easement that allows others to cross the property. However, the buyer didn’t know about it before they bought the house. It is possible that they will be surprised to learn about it later.
Public Records Errors
Clerical and filing errors are common. Everybody makes mistakes. These errors can cause financial hardship while you attempt to correct them.
Unknown Liens
Unone of these conditions applies to a newly built home. Your property’s previous owners may not have been meticulous bookkeepers or bill payers. Banks and other financing companies may place liens on your property even if the debt is not yours. This can be a problem for distressed properties.
Illegal deeds
Sometimes, your property’s title chain may not appear to be in good standing. There is a high chance that the deed was signed by an undocumented immigrant, minor, unsound mind or someone who appears to be single, but is married. These situations can impact the enforceability and ownership rights of previous deeds.
Missing Heirs
The property may pass to the heirs of the deceased or the people named in the will. It must be probated before property can be transferred by a will. These heirs may be absent or unknown at the time of the deceased’s death. Family members can also contest the will to protect their property rights. These situations can lead to probate or real estate litigation that can take place long after you’ve purchased the property. This could affect your rights to the property.
Forgeries
Unfortunately, our world is not perfect or honest. Sometimes, however, a forged document or fabricated document that affects property ownership is filed in the public record. This can obscure the owner’s rightful title to the property. It is called “clouding title”. These forgeries could lead to the loss of your right to your home.
Undiscovered Encumbrances
Three can be more than one when it comes to owning a house. You may not be aware that third parties have a claim on all or part your property at the time you purchase it. This could be because of a lien or a mortgage that was previously repaid, or other non-financial claims such as restrictions or covenants restricting your property’s use. It is important to remember that just because someone has physical possession of a property does not necessarily mean they have full legal title.
Unknown Easements
Unknown easements may prevent you from using your property or land in the way you want. You may also be able to grant access to your property to government agencies, businesses, and other parties. Even though easements are not usually financial, they can still impact your rights to use your property.
Boundary and Survey Disputes
You may have seen multiple surveys of the property before you bought it. You may have seen other surveys that show a different boundary from what you saw. A neighbor or another party could claim ownership of a part of your property.
Undiscovered Wills
The state can sell property owned by a deceased property owner if there is no will or heir apparent. This includes the property. You assume all rights as the owner of such a property when you buy it. Even years later, however, it is possible for the will of the deceased owner to come out and put your rights in grave jeopardy.
False impersonation of the previous owner
It is possible to impersonate property owners by using common names and similar names. You could lose your legal right to the property if you buy a house that was previously sold by a false owner.
Conclusion
These and other issues are usually covered by a policy of title insurance. To protect your rights, ensure you have title insurance when you buy a house. The title agent may question the marketability of your property’s title, and you will not be able to get title insurance. You will then need to file a quiet title action with an attorney.