What Is a Title Search?

By Kayla Kesson Updated June 07, 2023
Reviewed by Alex Goldovsky

If you’re considering purchasing real estate, it’s likely that you’ve heard of a title search. It’s an affordable tool that can save a lot of time and money in the long run. Not only do they provide peace of mind, they’re also required by lenders when closing on a property. So let’s jump right into the basics.

What is a Title?

The title of a property is comprised of legal documents proving ownership, property rights and encumbrances. A title search is the process of reviewing public records to retrieve recorded documents that are associated with a given property. This will provide an in-depth analysis of property details such as the legal ownership, tax information and an active lien breakdown which may affect the purchase. Legal ownership is determined by recorded documents called deeds which transfer the property from one party to another.

Online Title Search

Different Types of Title Searches

There are different types of title searches which determine the scope of the search. The most common types are:

  • Current Owner (O&E Report): a search of the property back to the deed where the current owner obtained title.
  • Two Owner: a search of the property back to when the prior owner obtained title.
  • 30-Year: a search of the property over a 30-year period.
  • Full State Statute: a search of the property based on state statute to issue insured title.
  • Assignment Verification Report (AVR): a search for assignments and mortgage related documents to verify the last mortgage holder or assignee.

Importance of Having a Clear Title

Having a clear title means there are no disputes over property rights, and there are no encumbrances on the property. Also referred to as free and clear, a clear title is important to ensure the sale of the property cannot be disputed.

The purpose of a title search is to determine the lawful owner of the property, as well as identify any outstanding debts that are tied to the property such as mortgages, taxes, and liens.

A title search can be ordered from an attorney, title company, lender, investor, or homeowner.

A title search will uncover unpaid debts tied to the property such as municipal liens and HOA liens. It will identify outstanding mortgages along with documents associated with the mortgage such as assignments and modifications. Foreclosure actions are reported so one is able to tell if the property is pending foreclosure. Judgments and liens against the property and against the owner are also provided. A title search will also reveal whether or not the property taxes have been paid, or if they’re delinquent.

Idaho Prorepty Title Search

The Importance of Conducting a Title Search Before Purchasing a Property

If you’re purchasing a property, it’s important to know of any outstanding debt since delinquent taxes and certain liens such as municipal liens will stay with the property even after the sale and become your responsibility.

Identifying Potential Issues with the Property

The title search can reveal issues that a prospective buyer may not know about. Some possible issues include invalid/fraudulent deed transfers, boundary line disputes, missing interest from a prior owner, or unpaid liens.

The title report will show all parties who own the property as well as provide a copy of the deed. It’s important to ensure they own 100% interest as all interest holders would need to sign the deed.

If a title search is not conducted, any unresolved issues and liens can become the responsibility of the new owner.

Due Diligence
Due Diligence

When is a Title Search Required?

Real Estate Purchases

A title search is used for verifying all liens before the purchase of the property to make sure they are being paid off at closing and the new owner does not have to assume them. A title search report will be used to generate a title commitment and title policy as evidence of title insurance on the property. Typically, a full state statute title search is ordered on purchase transactions.

Refinancing a Mortgage

A title search is also used for refinance transactions with and without title insurance. The title report is used to generate a title commitment and verify lien position of the new mortgage, as well as serve as approval of the borrower for the refinance transaction. For some HELOC mortgage originations or 2nd position mortgages, the title search might be sufficient without title insurance as the 1st position mortgage typically monitors all liens against the property.

Transferring Property Ownership

In some cases, a title search is a tool for verifying that the property is free and clear of all liens to transfer the ownership. The search will be used for copying the property legal description and proper ownership details for the new deed prepared to transfer the property. Land acquisition companies use the title report for preparing deeds, leases, or purchase agreements.

Don't Make These Title Search Mistakes!

It’s important to understand what is on a title search. Here are examples of some misconceptions.

  • The title search didn’t include the note: A title search will only provide documents that are recorded in land records. Notes are not recorded; however, the mortgage (or deed of trust) will be.
  • The title search doesn’t list the unpaid balance of the mortgage: A title search will only list the origination amount that is listed on the mortgage copy. Mortgage payoffs are not available to third parties.
  • The title search only provided the most recent deed: Be mindful of the type of search you are ordering. A Current Owner Search will only include the deed into the current owner. Always be familiar with the scope of the search that is being ordered.
  • The title search doesn’t list any schedules and exceptions: A title policy will list schedules and exceptions whereas a title report does not.

Not Getting a Professional Opinion

It is crucial to understand the property search results in order to make an informed decision. A title company cannot interpret the findings or provide their opinion. Consulting a real estate attorney is always recommended.

Not Verifying the Property's History

Verifying the property’s history will help reveal if all deeds transferred 100%. If there are any transfers with missing interest, it could result in that party trying to retain ownership.

Ignoring Red Flags

Red flags should never be ignored. Any lingering concerns should always be addressed with a real estate attorney.

Skipping the Title Insurance Policy

Skipping title insurance puts you at risk for a potential title claim even years after purchasing the property. This could mean a lienholder comes after you for a lien that was not disclosed on the title search, or it could be an individual that had ownership rights that no one knew about.

What is title search
Professional Services Title

What Documents Will Commonly Appear on a Title Report?

Each title search is unique. A report on one property may uncover limited, standard documents while a report on another property may unveil excessive, complex documents. Document types that you’ll most commonly see are deeds, mortgages, judgments, and liens.

  • Deeds: A deed is an official transfer document showing the change in property ownership. The seller is referred to as the grantor, while the buyer is referred to as the grantee.
  • Mortgages: A mortgage (sometimes called a deed of trust depending on the state where the property is located) is a legal contract between a lender and borrower used to buy or refinance a home or piece of property. If the borrower fails to make timely payments, the lender reserves the right to take ownership of the property via a foreclosure process.
  • Judgments: A judgment is a court order against a debtor which legally enforces that a debt be repaid. Judgments against the homeowner would appear on a title report.
  • Liens: There are many types of liens such as Federal Tax Liens, State Tax Liens, Code Enforcement Liens, Municipal Liens and HOA Liens. Liens from a municipal agency will attach to the property and are some of the most dangerous lien types.

Example of the Title Search Process

A title search is one key piece to the property buying process. It is usually managed by a title search company, independent abstractor, or the prospective buyer’s attorney. The title search may also be initiated by a mortgage lender or investor to verify legal ownership, as well as possible claims against the property. The abstractor will begin by locating the property in the county’s assessment records. Here they can obtain important property characteristics such as the parcel number (a sequence of numbers used to identify a property), legal description (the geographical description that identifies a property’s exact location), owner’s name and assessed values. The abstractor will then research the property tax status. At minimum, the current year’s tax status will be reported, as well as any prior delinquencies. The report will also indicate if delinquent taxes have been sold, leaving the property at risk for tax foreclosure.

It’s at this point that the actual search begins for property related documents. The abstractor will either conduct this search in the county recorder’s office or online records. In order for a document to be effective, it must be recorded in the county’s public land records. Once a document is drafted, it is sent to the county recorder’s office where it is verified and recorded. This makes it an official document. All recorded documents get assigned a document number and are entered into a searchable database. Documents affecting a specific property will contain the legal description and parcel number associated with the property. The abstractor will search the records using the expected current owner’s name, only including those which contain the legal/parcel number for the property in question.

Online Title Search
Online Title Search

How Long Does a Title Search Take?

While other title companies may take a week or longer to produce a title report, ProTitleUSA's highly trained staff can complete title searches faster, without jeopardizing quality. A residential title search can generally be completed within 24 to 48 business hours. A commercial title search may take closer to 72 business hours. Location of the property and complexity of the search determine how long the report will take. For reports needed sooner, the search can be expedited for an additional fee and returned within four business hours. Best of all, orders can be placed online at any time - day or night - using our website! Confirmation will be emailed upon receipt of the order request. Once the report has been completed, a single PDF containing the title search and our easy-to-read summary sheet will be emailed to you.

A reviewer of the title search should be someone who knows the basic lien types, common pitfalls, and title issues. We recommend a book called “Bullet Proof Title Due Diligence” as a basic introduction for various liens found on the title report. In many cases, nuances exist in each state, county and even local jurisdictions that might cause an issue. If the reviewer is new to reading title search reports, we recommend ordering ProTitleUSA’s dashboard and analytics for bulk orders over 20 as the reporting is simplified to pass and fail with amounts for each asset.

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