By: Gary A. Coffin
A title search is an examination of real estate ownership records filed with the local county registry of deeds, other municipality or other depository of records depending on your state. The examiner will look at the current owners’ deed and prior owners’ deeds to make certain each deed was prepared following the proper procedures for real estate conveyances within the state the property is located. Most states have statutes dictating the format a deed must follow to properly convey interest in real estate.
The examiner will also review the following:
- Look to make certain the seller on each deed was in fact the individual who owned the rights to the interest they were conveying.
- The description will also be checked for errors or inconsistencies.
- They will look to see if any other interests in real estate were granted along with the home and lot described such as a right of way over a neighbors property.
- Rights to the property that were given away by the current or prior owners that are indicated on the deed be will reviewed by the examiner to make certain they are consistent with the current deed.
- They will also look at estate records at the municipal probate office for any ownership transferred as a result of a person’s death.
After establishing a chain of ownership the examiner will then look at the records to see what each owner did with the property during their ownership, for example:
- Did they subdivide it and sell off a portion of the property?
- Did they grant anyone an easement to use the property for a specific purpose?
- Did they add another person to the deed?
- Are there conditions or restrictions on title?
- Did they mortgage the property or were any other liens placed against the property?
- Did they convey out any property rights not accounted for in the current deed?
This information will be analyzed to make certain it is consistent with the information contained in the current deed. Mortgages and liens will be examined closely to make certain they were properly released and no longer affect the title. Any irregularities or undischarged liens will be noted and reported back to the person or company requesting the search.
It is important to understand that the examiner is only reviewing the information available to them at the depository they are searching. It does not mean the information contained at the depository they are searching is complete or correct. The examiner has no way of determining if a signature on a deed was forged, if all the heirs were identified and listed in the estate records or if the information in the depository was properly listed so the examiner could retrieve it. Equally important to understand is that most titles are not researched back to the beginning of time, which in New Hampshire is a grant of land from the King. Each state has their own title standards dealing with what is considered a reasonable amount of time to examine title. To qualify as a full search in New Hampshire an examiner can start the search when they find a Warranty Deed in the chain of title that was recorded with the registry of deeds at least 35 years ago or a Quitclaim Deed recorded at least 50 years ago. In New Hampshire and many states the title examination is limited to research in the registry of deeds and probate. Money due for property taxes, condominium association dues and other real estate related assessments will not be disclosed by a title examination unless a lien has been recorded against the real estate at the appropriate depository.
The examiner researches easements, conditions and restrictions to ensure they comply with local statues and title standards. Depending on the purpose of the search, the examiner may not be looking at the title through the eyes of the buyer. For example a property may have a restriction that prevents horses kept on the property, which would not be viewed a a title defect but may affect a buyers enjoyment of the property if their intent was to build a barn and raise horses on the property. If a title has property restrictions, title conditions or association by-laws, a buyer should obtain a copy of the most recent amended version and review them thoroughly.
Although a title examination preformed by a competent title examiner will uncover many title related issues, there are many risks that lay outside the the scope of a title examination. Protection for some of these risks can be obtained through the purchase of an owner’s title insurance policy which will be the subject of next weeks blog.
Note to New Hampshire Real Estate Agents: This blog is a condensed version of a New Hampshire Real Estate Commission approved 1 hour elective course entitled “Basics of Title Insurance”. For information on this or other courses provided by Horizon Settlement Services, Inc. please click on the real estate education tab at www.horizonsettlement.com.