A title search is an examination of public records to confirm the legal ownership of a property and identify any claims, liens, or encumbrances that could affect your ownership rights.
What a title search reveals:
Chain of ownership — confirming the seller has the legal right to sell. Outstanding mortgages or liens (tax liens, mechanic's liens, judgment liens). Easements or restrictions that affect how you can use the property. Boundary disputes or encroachments. Unpaid property taxes. Pending legal actions involving the property.
Why it's important:
Without a title search, you could unknowingly purchase a property with existing debts, liens, or ownership disputes. These issues can result in financial liability, inability to sell or refinance, or even loss of the property.
Title insurance:
After the title search, most buyers purchase title insurance to protect against any issues that the search may have missed. There are two types:
Lender's policy: Required by most mortgage lenders. Protects the lender's interest only.
Owner's policy: Optional but strongly recommended. Protects your investment for as long as you or your heirs own the property. A one-time premium is paid at closing.