FBI data suggest about 9600 homeowners have succumbed to title fraud. It can be a small number, but its impact on anyone can be significant. Since everyone wants to own a house, pertinent curiosity should be how to determine identity theft. The solution is a title search. A seller transfers property ownership to the buyer. However, how do you know he is the actual property owner? You can learn about anything related to the property through a title search, such as divorce claims, bankruptcies, tax liens, seller's ownership status, etc. It is an extensive process that needs due diligence. Taking professional help in these matters is always better.
You can turn to a reliable title search company to investigate and generate a title report. In legal terms, this is called Ownership and Encumbrance letter. The report gives you an insight into the property’s actual owner, mortgages, restrictions, easements, unpaid liens, etc. You will also learn about legal property description (full location) and old ownership disputes. Here is a quick look into how this process works.
Previous Ownership Claims
Public record investigation can reveal the current owner, older owners, and the first title holder. Your title company can check with government offices to find accurate details. Suppose they spot any gap in the report. In that case, the professionals will examine all the possible scenarios, such as deed forgery or the owner using a different name to get the title. These situations can lead to legal steps, where claimants will appear in court to prove they are authentic. They will only win the claim if they produce enough evidence.
Image Credit: Eden Emerald Mortgages
Tax Liability
Is there any tax pending on the property? If yes, what amount is due, and what is the deadline? As a buyer, you would prefer to avoid getting a property with a lien. The government can auction it on the market to recover the tax. On a different note, you can save your investment if you get insurance for the property as a lender.
Site Survey
Inspection officers can check the property for encroachments and other issues affecting the title. A physical examination lets them verify the property size, scope of improvement, and signs of easements, which may have yet to be recorded. Close investigation is also necessary to ensure the property is vacant or under use. Whatever happens, the buyer gets all the details that make the title search even more meaningful.
Judgment Search
At this stage, the title company professionals can determine whether any judgments on the property are pending for the owner to fulfill. In the real estate field, it's called a general lien. The government can sell the property to satisfy judicial decrees, unpaid taxes, liens, etc. A seller must remove these defects before transferring the property title to the potential buyer. It takes a thorough legal process to clear the title of all the claims and judgments.
The title search process reaches its conclusive end. If everything is proper or rectified, the interested parties can seal the deal, and the title can be transferred hassle-free. However, you must have realized the complexities involved in this area. That’s why taking professional advice from title companies will be precious.
ABOUT THE AUTHOR
Olivia Poglianich
Content Strategist
Olivia Poglianich is a nomadic brand strategist and copywriter in the wooden crafts and 3D product design space who has worked with brands such as Visa, Disney and Grey Goose. Her writing has taken her all over the world, from a Serbian music festival to a Malaysian art and culture event. Olivia is a graduate of Cornell University and is often writing or reading about travel, hospitality, the start-up ecosystem or career coaching. Her latest interests are at the intersection of web3 and communal living, both on and offline.
