What is a Title Search? A title search is a means of determining that the person who is
selling the property really has the right to sell it, and that the buyer
is getting all the rights to the property (title) that he or she is
A title exam is performed according to the following steps:
Chain of Title This is simply a history of the ownership of a particular piece
of property, telling who bought it and sold it, and when. The
information may be derived from public records - usually a County
Clerk's or Recorder's Office - or obtained from title plants privately
owned and maintained by title companies. There are great varieties of
such plants - index cards, punch cards, tract books, even sophisticated
computerized plants. However, they all contain essentially the same
information from which the history of the title may be secured.
Tax Search This is a search to determine the present status of general real
estate taxes against the property. The tax search will reveal if taxes
are current or whether any taxes are past due and unpaid from previous
years. In addition, the tax search will indicate the existence of any
special assessments against the land and, if so, whether or not these
assessments are current or past due.
A due and unpaid tax or special assessment is a prior lien or
claim on the property above all others. If a buyer purchases property
with unpaid and past due taxes or assessments against it, he or she is
likely to find a government body--the village, county, or state--placing
the property up for sale to pay those taxes or assessments. A tax
search reveals the status of the taxes. Title insurance protects the
buyer against loss from unpaid and past due taxes and assessments.
Report on Possession In many places where it operates, Secure Title Services, Ltd.
sends inspectors to look at the property to verify the lot size, check
the location of improvements, look for evidence of easements that are
not shown of record and check on who is living there.
The purpose of this is to supplement the information learned from
the title search. In the eyes of the law, any buyer of real estate is
assumed to have notice of all matters properly shown in the public
records as to that real estate as well as any information that an actual
inspection may reveal.
If the inspector detects an unrecorded easement or other evidence
of outstanding rights that could affect the owner's title and possibly
the value and intended use, the company tells the buyer of these things
before he or she closes the purchase. Those matters must then either be
disposed of or shown as exceptions in the title insurance policy.
Sometimes when an acceptable survey and appropriate affidavits are
received, an inspection will not be made.
Judgment and Name Search One of the most important parts of the title search is to
determine if there are any unsatisfied judgments against the seller or
previous owners which were in existence while they owned the title. A
judgment is a general lien against the debtor's real estate and
constitutes security for any money owed under the judgment. The real
estate can be sold to satisfy the judgment.
It is extremely important to be sure that a title is not subject
to judgments against the seller or previous owners. Title insurance
provides this protection. A judgment against a person named Smith may
affect the title of a seller named Smith, depending on whether or not
they are the same person. So all possible variations of the name must be
For example, the name Smith might be spelled Schmidt, Schmid,
Schmidtt, Schmidz, Schmied, Schmiedt, Smid, Smythe, and so on. The name
Nichols can be spelled 73 different ways, from Nachols to Nychals. The
task is to determine which of these applies to the owner in question.
First names have to be checked, too. There are 25 foreign forms of John,
including Johann, Jehan, Hans, Shaun, Gudi, and Efom.
Rights established by judgment decrees, unpaid federal income
taxes, and mechanic's liens all may be prior claims on the property,
ahead of the buyer's or lender's rights. If a judgment is discovered
that constitutes a defect in the title, it is pointed out, and the
seller must then eliminate it before the title of the new buyer can be
insured free and clear of that judgment.
Commitment When these searches have been completed, the title company issues
a commitment to insure, stating the conditions under which it will
insure the title. The buyer and seller and the mortgage lender can
proceed with the closing of the transaction after clearing up any
defects in the title which may have been uncovered by the search and
The mortgage lender is as concerned as the buyer about the
quality of the title because the property is to be security for the new
mortgage loan. The mortgage lender requires assurance that it has a
valid first (or another acceptable priority) mortgage lien on the
property. This is not only common sense, but generally is a legal
requirement of regulated mortgage lenders.
The lender's title insurance, however, doesn't protect the new
buyer of the property. Although the land is the same, the interest of
the buyer and the interest of the lender are very different. The
provisions of a lender's title insurance policy are very different from
those of a buyer's policy, so the buyer should obtain his own policy,
often issued simultaneously with the lender's policy.
What is title Insurance? Title insurance protects your ownership of property you acquire.
It protects you from title defects which may have been created in the
past, while other types of insurance protect against future occurrences.
Title insurance is issued based upon a search of public records to
determine the marketability of your property. However, it also protects
you from matters not disclosed by public records.
What is a Title Defect? A title defect is anything in the past ownership of a piece of
real estate that may interfere with the owner's right to "peaceful
enjoyment" of the property or that may cause the owner's loss to any
portion of the property. While a title search will disclose title
defects revealed by public records, there are other risks covered by
title insurance that would not be discovered by a title search, such as:
Misfiling or improper indexing of recorded documents.Forgeries or false impersonation of those executing documents.Secret marriages or misrepresentation or fraud as to actual marital status.Undisclosed heirs or children born after execution of a will, or deed delivery after death.Execution of documents under fraud, duress or undue influence.Confusion as to same or similar names.Lack of capacity (legal age or mental competency) of a grantor.
Why isn't an Attorney's Title Examination and Opinion Sufficient? An attorney's liability is limited to errors and oversights; an
attorney is not liable for loss caused by hidden defects. Recovery of
damages against an attorney is limited to that attorney's insurance,
solvency, and lifetime.
Doesn't a Warranty Deed Protect Me? No. With a general warranty deed, a grantor can only pass to the
grantee such title as the grantor holds. Recovery against a grantor
under a general warranty deed depends entirely upon the financial
ability of the grantor to pay a judgment, if one is rendered, provided
that the grantor can be located at the time a title defect is
discovered. This can involve a long and costly court action.
I Paid for a Lender's Title Policy. Doesn't That Protect Me? No. Even though your mortgage lender will require title
insurance insuring it has a first lien on your property, your ownership
is not protected unless you purchase an owners policy. In the event of a
claim, the title company would only protect and defend the lender. As
the owner, you would be liable for the financial burden of your own
legal defense. If the defense is not successful, you could lose your
home. Without owners title insurance, you become a self-insurer.
Unless you're in a position to sustain financial losses defending the
ownership of your property, this is not feasible.
What Does it Cost? Title insurance rates are based on a graduated scale according to
purchase price. These rates are filed with the State of Ohio and are
standard throughout the state.