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What is the purpose of a title search when buying a home?

Some parts of buying a house make more sense than others. Looking at the property and then having someone else inspect and appraise it helps ensure that you pay a reasonable price and know the condition of the property you intend to purchase.

A title search, on the other hand, can seem unnecessary. After all, the people living in the home who listed it for sale with a real estate agent are clearly the people who own the property, right?

However, the legal ownership of real estate can be more complicated than you might think. A thorough title search and a title insurance policy both help protect you from losing the money you intend to invest in this purchase.

Title defects can end your claim to ownership

Sometimes, there are liens or other issues with a property’s title that mean people can’t sell it. Other times, there could be someone besides the seller with an ownership interest in the property.

Maybe there was a messy divorce, and an ex-spouse has a claim to the property. Maybe there was a mistake during estate administration that cut a beneficiary out, leaving them with an unsettled claim against the property. In a title search, official records are checked for any signs of blemishes on the ownership record.

Without a title search, you might miss these issues and wind up financially responsible before someone else has liens. In extreme cases, you might lose the property to someone else.

A title search can help you find these issues. Title insurance will both pay for your legal representation if another party brings a claim against the property and reimburse you if you lose ownership of the property because of a title defect. Simply put, title searches and title insurance are crucial protections for those about to purchase real estate.

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