A full property title search is the starting point for determining the legal ownership of the seller and veracity of going ahead with the purchase in order to protect the title or rightful ownership of the property. This is one of the most critical steps in the process of purchasing a property.
A title search is a process that is performed primarily to determine the answer to three questions:
Does the seller have a saleable interest in the property?
What kind of restrictions or allowances pertains to the use of the property?
Do any liens or liabilities exist on the property which needs to be paid off at closing?
Why do a 'title search' of the property?
A search report traces the history of a property - who was the original owner of the property and how it has moved hands over a period of time before reaching the present seller. A title certificate states whether the property is unencumbered and has a clear marketable title. This document will state if there is any existing mortgage, litigation, condition or claim, which is likely to affect the title of the buyer adversely. A clear and marketable title means the seller should be genuine and the actual owner of the property. The report acts as a security for the purchase of a property. The report gives comfort to the purchaser that the title of the property he is planning to purchase is good and he will not face any problems at a later stage due to some pre-existing charges or encumbrance, or legal dispute on the property.
What does a 'title search' include?
Depending on the nature of the property and the nature of the seller of the property a full property title search may include the following:
Ownership structure : A report on the ownership structure of the property, individual, corporate, leaseholders, tenants in common, joint tenants, society among others.
Certified deed : Most recent government certified copy of the deed enhancing the ownership and title of the property.
Document book and page : Location of the documents and the page numbers with the registration offices and local government offices.
Legal description : Description of the property in totality is per legal requirement with reference to historic transactions and transfer of rights of the land/building with historic chain of ownership.
Mother documents : Series of historic documents of the property for historic transactions and transfer of rights of the land/building enhancing the legal heritage and ownership of the title of the property.
Possession : Possession and ownership of the property with marketable value.
Right of way : Any secondary encumbrance, obligations or shared rights for 3rd parties.
Leases : Report on a clear and marketable title ownership of the property which is unrestricted or free from obligations with right to transfer of ownership/lease.
Mortgage search : Lien against mortgage with details of lender and mortgage amount and terms and conditions of lien with details of outstanding dues.
Equity loan search : Equity loans or participation/contribution in equity capital through property value and participation in way of property.
Tax payment search : Taxes due and tax clearances with pending historic tax claims or litigation estimation of tax liability.
Foreclosure search : Notice of default, pending litigation or other obligations and encumbrances from a previous lender.
Bankruptcy search : Obligations or legal encumbrances in terms of bankruptcy or BIFR proceedings against owner of title or lease of the property or the seller.
Civil court record search : Records of property and the land under the local civil courts clarifying legal encumbrances (if any).
Tax lien search : Due taxes and litigation thereof with restriction and obligation toward taxes of various natures restricting use or sale of property.
Municipal services lien search : Due service fee and charges for use of various utilities like municipal taxes, water charges among others and estimation of dues and scrutiny of claims against property from local municipal body.
Property restriction : Restriction and legal or statutory obligations in sale of property from rightful owner in terms of trust or minor among many others.
Spousal support lien search : Obligations or encumbrances towards spousal support or alimony or any such implied restrictions towards transfer of ownership of property.
Child support lien search : Obligations or encumbrances towards child support with delinquent payments with implied liabilities or restrictions toward property.
Treasury lien search : Liabilities or unpaid obligations towards the central government and tax department restricting transfer of property or of attachment of property thereof.
State tax search : Dues towards state and territory taxes like sales tax, employment taxes, employee funds which restrict or have implied obligations on the property.
Property zoning : Clearances from local, municipal, state and central regulators towards green zone, ecological zone, village restrictions, agricultural land among others.
Property easement search : Shows property easement, right of way among others.
Title abstract document : An official abstract document of the property.
Municipal assed value : Certified valuation of the property as per the local state government or municipality.
Plot/survey map : Recorded official survey map and location map of the land/property.
Power of attorney : Recorded authorization for enactment of conveyance on behalf of the title deed owner or legal validity of authorization with implication and obligations.
Special assessment : Special assessment or pending liability or litigation.
Promissory note : Personal loan against the property title holder or vendor recorded against the property.
Correction deed : Correction or rectification deed filed with local authorities for the property.