The Importance of Title Examinations and Title Insurance

The purchase of a new home can be both thrilling and stressful. Excitement about your new home and plans for the future can also be accompanied by fear about potential defects or other hidden problems. Luckily, many potential issues with your new home can be discovered and addressed if you plan ahead. Conducting a title examination is one way that you can protect yourself against potential problems.

What is Title?

Title is a legal concept that applies to someone who has the legal right to ownership of the property. Title can pass from one person to another when the home is sold. If you were to purchase a home tomorrow, the seller (the current owner) would be passing title to you in the legal documents that represent the sale. Assuming that no one else had a valid claim to the property, you could then enjoy having title to the property without worry. Typically you would “record” the legal documents that gave you title – this means you would file those documents with a government office, where they would be kept on file and accessible to the public.

Why Conduct a Title Examination?

Conducting a title examination, or title search, is a crucial step before buying a home. According to the American Bar Association, a title examination is “a study of the records relating to the ownership history of the property and sometimes of other matters related to ownership interests in the property.” This process generally involves searching local land records to see who has a legal right to the property in question. Conducting a title search can help you confirm that the person selling the property to you has the legal right to the property and therefore also has the legal right to sell it. As a homebuyer, you’ll want to make sure that there is no one else who has a legal claim to the property and who may be able to show up later and challenge your ownership of your new home.

What will a Title Examination tell me?

Conducting a title examination will tell you if other people have a legal right to the property, by providing a list of when the property was sold and to whom. If the property was already sold by the seller to someone else, that should show up in the title examination. If the seller never had the legal right to the property in the first place, that should show up in a title search as well. A title search will also reveal any encumbrances on the land – if anyone else has a right to use the land in addition to the seller. That might include someone who has the right to pass through the land, or a utility company with the right to build or install equipment on the property. Discovering such claims to the property allows you to identify and understand the likelihood of future litigation regarding the ownership and use of the property.

If you or a loved one is considering purchasing a home, it’s important to have an attorney you can rely on to guide you through the home buying process – including title examination. Contact Carnal & Mansfield, P.A in St. Petersburg for a consultation today.