Title Search: The Process
A title search dives into public records and historical databases (title plants) to uncover all documents related to a specific property. It uses the legal description and owner names to find crucial information like mortgages, liens, unpaid taxes, easements, boundary disputes, assessments, judgments, and other court proceedings that might impact ownership rights.
Even new construction sits on land with a history. A title search ensures no outstanding claims linger from previous owners. Additionally, contractors, subcontractors, and suppliers may place liens on the property if unpaid. A title search identifies such liens to prevent future problems.
Title Commitment: Our Promise
The title commitment is an official document outlining what the company will insure based on the title agency's findings during their search and risk analysis. The title commitments has several parts, called schedules, that vary by state:
SCHEDULE A
The Facts
This section details the parties involved, property description, policy type, current owner, and insurance amount. It also specifies the timeframe for the commitment's validity.
SCHEDULE B
Property Details
This section explains any tasks required before closing (like clearing liens or obtaining affidavits) and identifies limitations on coverage, such as existing restrictions, easements, and unpaid taxes. Depending on your state, Schedule B may be split into two parts: Requirements to Close and Exceptions from the Policy. In some states, there may be additional schedules.
SCHEDULE C
Requirements
May show requirements in the states that do not list them on Schedule B.
SCHEDULE D
Disclosures
May show requirements in the states that do not list them on Schedule B. In some states, there may be additional schedules
Title Insurance Policy: Your Protection
For a one-time purchase, the Title Insurance Policy insures your right to own, possess, occupy, use, control, enjoy, and dispose of the property you purchased as long as you own the property. It is your best protection against potential defects from past events in the history of the property.
Policy Jacket
Risks and Exclusions
A one-time purchase, the Title Insurance Policy protects your right to own, occupy, use, control, enjoy, and dispose of your property for as long as you own it. It safeguards you against potential problems arising from past events related to the property's history.
Schedule A
Insurance Details
Provides the details of the insured/vested party, property description, policy type, effective date, and policy amount.
Schedule B
Specific Exceptions
The exceptions listed in this section are specific to the vesting owners and the property. The policy does not insure against loss or damage for the exceptions outlined in this section. Like in the commitment, some exceptions may include established restrictions, easements, and taxes.
Exhibit A
The Property
A detailed description of the property is outlined in Exhibit A.
