Why You Need Title Services And What They Reveal

20 January 2020
 Categories: Real Estate, Blog


One step your lender will take when you are purchasing a home is called a title search, and this step often confuses people who are buying homes. What is a title search? Is it necessary? What is it for? These are just a few questions homebuyers have about title search services, and they are all valid questions to ask. If these are things you are wondering about as you are in the process of buying a home, here is some information that might answer most of your questions.

A Title Search Tells You If the Homeowner Is Really the Owner of the Home

One of the key purposes of a lender hiring a company to perform a title search is to find out who really owns the home that a person is buying. If the seller of the home is not really the person who owns the house, you could run into some trouble, and a title search will tell you this. There are all kinds of situations where people have tried to sell homes they really did not own. If you were to purchase a home from someone that really did not own it, you could end up facing all kinds of problems later on. A title search, therefore, protects you in situations like this by making sure the seller really owns the home.

A Title Search Finds All Liens

If anyone has a stake in a home, it is represented by a lien. The most common form of lien you will find is a mortgage. The person who owns a home and is selling it would have a lien on the house if he or she has a mortgage. If this is the case, when the sale goes through, the mortgage company would be first to receive money from the deal. After the lender is paid, the rest of the money would go to other lienholders. If there are no other lienholders, the seller would receive the remaining balance from the proceeds of the sale.

A title search finds liens that a seller does not reveal or even know about. A common type of lien that is found during a title search is a contractor lien. If a contractor performed services for the homeowner to fix something with the house, the contractor could place a lien on the home if the homeowner never paid the bill.

Finding liens is vital as they must be paid when a home is sold. If liens are discovered after the sale of the home, the new homeowner is responsible to pay them. A title search would prevent this from occurring, and that is why you should want a title search as a person who is buying a house.

Do you still have questions about this? If so, you should reach out to real estate title search services to learn more.