SELLERS: Anticipate the ‘Title Search’ before you put your house on the market.

The Title Search is one of the last steps that happens in the home buying process. You may ask what exactly is a Title Search?

The buyer’s attorney will ‘order title’ after the buyer has received the mortgage commitment from their lender. What this actually means is the buyer is buying an insurance policy – a ‘title’ insurance policy. The insurance company is insuring that there are no liens, encumbrances or other ‘clouds’ on the legal title of the property. The most common item that comes up are old mortgages whose payoff was not properly recorded.

Other typical items that come up are permits for work done on the home that were not closed in the town building department. Encroachments of a neighbors’ fence onto the property is another typical issue that can arise. More serious things are decks or sheds that the homeowner never got a permit to build. These problems can really delay a closing because the title report is not ordered until late in the purchase process.

I always visit the building department before I list a property to head off some of these exact issues. Just recently I found an issue with a plumbing permit and an electrical permit in my Sellers property file at town hall.  In the file, at the building department, both of these permits were closed. However, on the towns digital system, they both showed as open.  I sent the documentation I copied from the building department to the plumbing and electrical inspectors asking them to close the respective permit in the system — and they did. A potential crisis averted!