Why Might You Want To Perform A Chain Of Title Search?
Before you purchase any real property, whether it’s for your primary residence, as a second home or as an investment vehicle, it pays to do your due diligence. Doing the necessary research about the property ahead of time can prevent all manner of problems in the near term as well as over the long term. There are a lot of things to be checked before you close on a property of any kind and one of the most important of these is to perform a chain of title search.
If this is the first time that you’ve purchased real estate, then you may not be familiar with what this search is or for that matter, what a title is in relation to real property; fortunately this is an easy concept to explain. Title is a legal term for the ownership interest in a given piece of real property as well as the actual document which provides proof of this ownership interest in written form. Transferring ownership of real property involves the transfer of this document as well as of the ownership interest in the property.
What you’re looking for is a complete history of the property, which includes the previous owners as well as any other uses that may have been made of the property in the past. A title search is required in the course of transfer of ownership of real property by most states, at least in terms of establishing the ownership history of the property. While knowing who all of the previous owners of the property you’re thinking of purchasing are may not be that important to know except as an interesting fact about the history of your home or investment vehicle, there are some other things that a chain of title search can tell you about the property, at least if it’s the right kind of search.
One of the kinds of information that you can uncover about a property by doing a title search is the environmental history of the property. Since certain types of chain of title searches can reveal information including the history of the property’s use by previous owners, a prospective property buyer can discover whether there are any environmental issues which may have been created by these previous uses of the property. For instance, if the property was a gas station at one time, this obviously raises some environmental issues for any future buyer of the property, especially if they plan a different type of use.
Of course, it’s not all that likely that you’ll find, say, a residential property which used to be a gas station or a petroleum refining facility since the zoning laws in most municipalities would make it exceptionally difficult for a property zoned for this kind of use to be rezoned as a residential property. However, it can and has happened (especially in semi-rural, rural and recently developed suburban areas) and it always pays to be careful when you’re planning to purchase a new home, commercial property or investment property. It’s best to know exactly what you’re getting before you sign anything.
Other than the possibility of environmental issues, doing a chain of title search on a piece of real property that you’re thinking of buying will let you know immediately whether the person or entity offering to sell you the property has legal ownership and can convey good title to the property to you as a buyer. This is actually why some states require that a title search be carried out; it protects both the buyer and their mortgage lender by ensuring that the title will include full rights to occupy, use or sell the property.
Before you make the decision to go ahead and buy any kind of property, whether it’s a home, business or undeveloped land, perform a chain of title search in order to make sure that you will have good title and that the property is free of any environmental or other issues which you’d like to avoid wrangling with (or at least be aware of) before you actually own the real property in question.
About The Author: Calvin B. Villanueva has written this article.
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