One of the most important steps in home buying is the title search, which is the process of making sure that the property is what you think it is, and the person you’re buying from has the legal right to sell it. Performing a title search is best left to the experts, and you definitely will need to hire a title search company if you want a title insurance policy to guarantee the title. It's possible to perform your own search, however, with some deep digging into county records.
Why Run a Title Search?
A title search is the process of checking the entire ownership history of the property to make sure that the seller has full legal ownership and the absolute right to sell it to you. What you may find is that someone did an intra-family transfer a generation ago, and the deed was not properly signed or recorded. This raises questions about the “chain of ownership,” and is a red flag for mortgage companies and insurance companies.
Beyond verification of ownership, there may be outstanding mortgages or liens on the property that the seller has neglected to mention. Some properties come with deed restrictions written into previous deeds or in a separate document, like homeowners’ association rules. Deed restrictions limit what you can do with the property. For example, there may be restrictions on what you can use the property for, so it’s important to learn of any restrictions before you hand over the purchase money.
Understand that if you go through with the purchase, title problems that surface later become your problems. That’s because you inherit the defects in the title with the property.
How to Access Property Records in Texas
Property records are held by the county clerk’s office in the Texas county where the property is located. The first thing you need, then, is the property’s address to locate it in the deed register. Records are public, which means that anyone can search them, and most counties make the records available digitally so you can find them online from the comfort of your own home.
Use a search engine to navigate to the county clerk’s website, then click through to the search portal that deals with property records. The actual webpage will look different from county to county but it’s fairly intuitive. Generally, you’ll type whatever information you have, such as property address and sellers’ name, into a search bar. If the records have been digitized they should show up. If not, you’ll have to visit the county clerk’s office in person and ask to inspect the physical records.
What to Look for in a Texas Title Search
What you need to do is re-create the chain of title – title companies call this an abstract. This is a list of all the people who have ever owned the property in question and, depending on the age of the property, could go back fifty or more years. If you’re lucky, you’ll find an old abstract of title with the paperwork prepared by previous owners when they bought the home. This will speed things up considerably.
Start by locating the current deed that transferred the property to the current owner. This contains the name of the person who sold the property to the current owner, then search for his deed, and so on and so on as far back as you can go. Read the deeds carefully to make sure the property ownership legally changed hands without any gaps: Owner A to Owner B, Owner B to Owner C, Owner C to Owner D and so on. Are the deeds signed, dated and notarized?
If you spot a gap or an error, you’ll have to ask the seller if they have the missing documents. Ask also about any liens, mortgages or other questionable documents you may turn up along the way. If there’s a problem with the title, it’s up to the seller to fix it. If he refuses, then you’ll probably want to walk away from the deal.
What About Title Insurance?
Buying title insurance is a smart move as it guarantees that the title is free from any unpleasant surprises that could hurt your ownership. Title companies issue these policies after they’ve reviewed the title for you – which they are more than happy to do for a fee. Since these companies are likely better qualified than you to examine the chain of title and uncover any worrisome issues, hiring one is a sound investment.
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