Investing in real estate can be a nerve-racking process. After all, you are investing in a sanctuary for yourself and your family. Alongside home inspection, one of the most important due diligence you need to exercise when investing in real estate is the title search.
A title search is usually initiated by your mortgage provider and it is intended to establish the property’s legal owner. A timely and accurate title search can help you make an informed decision. But what should you look for when carrying out a title search?
Here are three questions you need to ask during a title search.
Does the property have issues with the boundary lines?
While simple boundary disputes might seem insignificant, they can easily snowball into full-blown problems down the road. When it comes to real estate investment, you need to know exactly what you are putting your money on.
Does the property have an uncovered will?
This might come as a surprise. Unfortunately, it is not uncommon. Sometimes, a title search might reveal that the seller actually cannot sell the property in question after all because it features in someone else’s will. If the seller’s relative willed the property to someone other than them, then this can disrupt the chain of ownership, and this can cause problems during the transaction.
Are there liens or debts on the property?
This is a very common problem during a property search. If a property was used as collateral when taking out credit or if it has a lien on it, then these will show up during the title search. If you buy a property that has debt or lien issues, then those debts or liens could be transferred to you.
The road to property ownership can be long and winding. Find out how you can protect your legal rights and interests while investing in real estate.