Knowing the Difference Between a Title Search, Title Report, and Title Commitment
A title search, a title report, and a title commitment are all pieces of the puzzle that are required to complete your real estate closing at Lake of the Ozarks. They are each different, but they work together and play an important role in your real estate transaction. Arrowhead Title has been handling real estate closings for clients at the Lake of the Ozarks since 1984. Over the years we recognize that not everyone understands the difference between these three things and why they are all necessary. If you are involved in a real estate transaction, you may wonder as well. As a title agency at Lake of the Ozarks that believes in clear communication and keeping our clients informed, we wanted to write this blog to explain what each one is, how they work together, and why they are an important part of your real estate purchase. To learn more about title searches, title reports, and title commitments, just keep reading this blog.
A title search is a deep dive researching all available public records to learn about the history of the particular property's ownership. This search will go back to the very first owner of the property and include comprehensive information regarding potential clouds on the title. Clouds can include anything from errors in public records, unknown heirs, even forgery or fraud. It will also discover if there are liens on the property or unpaid tax liabilities, etc. The title is the official document that proves who owns a piece of property and has the right to transfer that ownership or sell the property. Ultimately, the purpose of the title search is to verify the person selling the property legally has the legal right to sell it. Obviously, if they do not have legal ownership of the property, they can’t transfer that ownership to you. The way to verify that ownership is through a title search.
The title report is an accumulation or summary of all the information that is discovered in the title search. The title report will let you know about any easements, encumbrances, HOA covenants, restrictions, and other things that could limit the use of the property you are buying. If there are unpaid taxes or other liabilities, that will be noted in the report, as well. By reading the title report, you as a buyer will be able to make an informed decision as to exactly what you will be able to do with the property you’re buying and whether it’s worth the price.
Your title company will consider the information in your title report to provide you with a title commitment. When you get a title commitment it is a promise from the insurance company that they will issue you title insurance at your real estate closing. It is possible that there will be conditions or exceptions based on what is included in the title report. A common example of a condition is that the mortgage and any liens associated with the property would have to be paid upon closing. Other conditions could be requiring a survey or resolving any lawsuits that may be connected with the property. Whatever conditions are included in the title commitment must be met before the title insurance policy will be issued. Title commitment can also have exceptions. An exception would be something for which the title company will not issue insurance. For example, your title insurance policy will not cover limitations on your property’s use like covenants, easements, restrictions, etc.
Arrowhead Title is Here for YOU!
While a title search, title report, and tile commitment all sound very similar, they each play their own role in your real estate transaction at Lake of the Ozarks, and each one relies on the other. Knowing what each one is and how they work together can help you feel more confident as you’re making decisions on such an important investment. When you are in need of a title search at Lake of the Ozarks, Arrowhead Title is here for you. We have the technology and experience to bring the accuracy you need when it comes to buying a home in Lake of the Ozarks. If you have any questions about real estate at Lake of the Ozarks, feel free to give us a call. If you’d like to stay informed with regular tips and information from Arrowhead Title, don’t forget to follow us on social media.