A title search is an examination of the records concerning a property to ascertain the current ownership of the property and whether there are outstanding liens, judgments, foreclosure, or bankruptcy proceedings and/or other encumbrances on the property that could impede the sale of marketable title to a purchaser. In a New York or New Jersey real estate transaction, a title search will be ordered on behalf of the buyer of a property.
The title search consists of searches for information, such as:
- Current and past ownership of the property
- Any outstanding mortgages that must be paid off prior to closing
- Any outstanding taxes, fees, assessments, etc. due
- Foreclosure or bankruptcy proceedings that may impact the owner and/or property
- Unpaid child support obligations
- Any other judgments or liens that remain unsatisfied
- Easements, rights of way, or other restrictions placed upon the property
While it seems obvious to think that the seller of a property, as held out in a contract, is the rightful owner of the property, in certain cases, that assumption could prove to be inaccurate. Additionally, old mortgages or liens could rear their heads in a title search, unbeknownst to a current owner. Because mortgages run with the property, not the owner, the title search will reveal that the satisfaction of a mortgage or lien is required before title can pass to the new purchaser.
Once the title search is returned, the buyer’s attorney and/or title company will forward to the seller’s attorney all the conditions revealed by the title search that must be satisfied by the seller prior to the closing. If these conditions are satisfied, title insurance can be issued, and title can be transferred from one party to the next.
Shortly before the closing, the title company will perform a final “rundown” of title, which is an updated, contemporaneous search of the foregoing items to ensure that nothing new has arisen while the parties have been under contract and/or since the initial title commitment was issued.
A title search is relatively inexpensive, and performing it vis-a-vis a reputable, competent title company helps us bring a transaction to the closing table. As we have mentioned before, the team of professionals required for a closing transaction is extensive, and the best teams are the ones built with professionals that are competent, capable, and collaborative. For title searches, buyer’s attorneys will typically rely on the title work performed by the title company aligned with the industry standards to review the public records available on the property and with a high level of accuracy and sufficiency so as to satisfy the buyer’s due diligence in examining the title before closing.
Disclaimer: The information contained in this post is not, nor is it intended to be, legal advice. You should consult an attorney for advice regarding your individual situation. We invite you to contact us and welcome your calls and communications. Contacting us, however, does not create an attorney-client relationship.
