When you purchase or mortgage a home or land, you sign a lot of paperwork. After closing, you get your deed and maybe an owner’s title insurance policy. Much work goes on behind the scenes under the roof of an attorney’s office, a title insurance company, or even a county courthouse to insure that there's clear title to the property. Although title searches are performed most commonly for the purpose of issuing title insurance, other reasons do exist.
Establishing Clear Title
When you are buying property, you want to know that it has clear title. Clear title means that no problems were revealed -- from a diligent search of the courthouse records -- that would cause your future ownership interest in the property to be questioned. A title researcher looks for problems or issues such as flaws in deeds, unpaid mortgages, property owners’ association liens, judgments, and unpaid taxes to determine what may be required to clear the title. Depending on your reasons for acquiring a title search and the desired information, a title search may only go back a few years, or may go all the way back to the original land patent from the United States government.
Insuring Title to Property
A diligent purchaser and a mortgage company will generally require title insurance in conjunction with a purchase or mortgage of property. The information in a title insurance policy is the result of a title search. A title insurance commitment is generally issued first which commits or promises to issue a policy once the requirements contained in the commitment are met. Title commitments contain the legal description of the property, the name of the person who owns the land, whether the property taxes were paid, and exceptions or reservations from title insurance coverage. A title insurance policy is not issued until a title search has been performed verifying the information.
Attorney’s Title Opinions
Title searches are also performed in conjunction with the issuance of an attorney’s title opinion, which is a formal written opinion by an attorney declaring title status. Whereas a title insurance policy offers insurance coverage related to defects that may emerge in the title to property, an attorney’s title opinion offers no such coverage. If defects are discovered that weren’t listed in the title opinion, a property owner’s only recourse is to seek financial compensation or assistance from the issuing attorney to clear the title defect. Title opinions might be requested by developers seeking the status of title prior to purchasing a tract of land, family members regarding estate-owned property, creditors wishing to place a lien upon an individual’s property, or parties to a lawsuit seeking to clarify ownership of the property.
You may be interested to know who owns the minerals under your property. That information can be determined by a mineral search. Mineral searches are some of the more complex and time-consuming title searches, as the mineral rights are often kept or reserved by sellers of property. Those mineral rights may have been further fractionally divided between a series of owners, and leased to individuals or oil companies that have subsequently assigned fractional interests in their leases.
- Better Business Bureau, Educational Consumer Tips: Title Insurance
- Ohio Bar Association: Title Insurance Protects Owners and Lenders
- Urban Financial Group: Wholesale & Correspondent Reverse Mortgage Lending
- Sadler Law Firm LLP: Title Opinions
- Title Examiner: Types of Title Opinions
- Land With Minerals: Conducting a Title Search for Mineral Ownership, A Worthy Investment
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