The Importance of Title Search and Title Insurance

No one wants to get their hands on a forged document especially if it"s a real estate title. It is the job of a title search company to guarantee the legitimacy of a land title, and supply it with title insurance. A Title Insurance is significant to the owner as it protects them against judicial proceedings regarding disputes over the title.

There are hundreds of strategies that people or court can use to claim a right on the property. The sole way to know if there are any claims is through a title search.

Rows of Houses

Throughout the title search, the real estate attorney will investigate to search for outstanding mortgages, liens, and unsettled taxes that are connected to the property. A property survey might also be conducted. This involves determining the exact limit or boundaries of the land, and whether the house is situated within the border.

Why do you need a Title Search?

Selling, and buying properties take a lot of work. And there are plenty of issues that come along the way. There are cases of children who inherited an estate from their parents, yet it turns out that the parents didn"t file a “legal right" to give their children the authority to sell it. Another common issue is people who keep buying properties without having the diligence to check the property"s background. Now, they are stuck with a lot of real estates that don"t have a clear title. Empty investment, right?

When you apply for a title search, you will quickly get answers to the following questions:

Pen and Paper

– Who is/are the present owner(s)?
– What is the real estate"s assessed value?
– What are the mortgages and charges on the property?
– Are there pending mortgages?
– Are there lawsuits and claims on the property that may affect the buyer?
-Are the property"s taxes paid?

In the absence of a title search, it is possible for a property to be sold without a clean title. Yes, you can still purchase a property without getting title insurance, but the money that you saved from not getting insurance is less than compared to the outlay that you will spend if you discovered that the property you bought is full of encumbrances.

Now that you know the importance of getting a title search, the critical question is, how much would it cost?

Title search companies will do all the researching stuff to know the background details of the real estate. According to Financial Web, title searches are usually priced at around $75 to $100. It might cost an extra, but a title search is an essential step whenever acquiring a property.

What is a Title Insurance?

After a thorough search, title search companies might discover hidden problems tied up to the property. For instance, a tax lien left unpaid by the previous owner. A title search may also uncover more severe issues like a lawsuit claim. All these issues are hurdles to have a smooth transaction.


That is why to protect the buyer; most title search companies also offer title insurance. If any claim is filed towards the property from a pre-existing problem, title insurance will cover the damages.

Some even require title insurance to be part of the transaction. It is suggested that a buyer should allocate closing costs of about 3% of the final mortgage loan.

The average cost of title insurance is $1000, but it depends heavily on the size of the loan and the property"s location. The good thing is, it is a one-time payment.

Buying a property is already an expensive decision. No one wants to have an empty investment, and no one wants to spend more penny after the final deal is closed. Thus, there is no room for taking chances. Applying for a title search and insurance, are the best way to be sure that the property you are eyeing is genuine, legitimate, and has no problems attached.

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