Do it yourself Title Searches

28 Replies

Hello everyone. I was wondering how possible it is for an individual to do a title search on a property as good as a title company can. If not, what specifically allows a title company to have a more in depth search than an individual?

Thanks

Jose

Anyone can go to a county hall of records and conduct a search. Although there are many types of searches that title companies do as per the requirements of lenders such as a Mortgage and deed search, owners record search, tax search lien search etc.. These searches are done with a history of 60 years which everything is copied and provided in the title search report..... then an underwriter examines all the searches and looks for defects if property is clean title insurance policy is produced which is called a commitment . But as far as your question can anyone do a search yes but your time is more probably more valuable doing other things.

@Scott Franklin  Where can I get the specific search domains used by title companies? What other defects would they be looking for? Also, as a novice how can I become aware of any "defects"?

After compiling all the data it’s time to review. Let’s say you are looking through all the details about mortgages on a subject property you want to make sure all mortgages are satisfied if a mortgage in the history chain wasn’t satisfied it’s a defect until cleared up. Maybe contacted the lender and getting a satisfied letter is all that’s needed to clear that up also under liens if you find a mechanics lien that would have to be rectified as well. There are many things that can raise red flags. Some things can be searched online but most searches are physically done at County Hall of records or Mnicipal records etc...

There are some free sites for example here is one http://publicrecords.netronline.com/

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You can do a prelim yourself, if you know what you're doing...but get a real title search before committing any real money.  I'm pretty competent at it, but will always get a real title search.  Example, do you know how to find that mortgage, or judgment, that has a typo in the spelling of the owner's name?  It's still valid, but you won't find it searching by the owner's name.  But, it'd probably only be a $100k mistake.

@Wayne - I totally agree with your statement above.  Missing one document in a search can be a $100k error.  I've seen investors wiped out of the industry trying to save a few bucks on a title search.

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@Jose Diaz  

Searches from any company has a certain degree of error, they receive data from a feed either directly from the recorders office or from another 3rd party vendor, plus there is human error .  Learning how to "abstract" on your own is a very valuable skill that has helped me immensely as an investor.  Do I still search title on my own?  Heck no! but I am quicker to recognize when something doesn't look right & it has saved my butt or made me money more times than I can count.

Medium realgroup360 480x270Ellis San Jose, Real Estate Group 360-The Note Guys | (805) 852‑7418 | http://www.realestategroup360.com | CA Agent # BRE#01855039

Thank you all for the input.  I was just wanted to know how possible and efficient it would be if I did it myself. Everyone is right that time is money, however I still want to learn as much as I can to understand what I am getting into. I guess I can work with a title search company as I educate myself.

One must be careful to look out for Municipal or County Violations.  Due to new precedents in Case Law in the State of Florida, governments are not recording these violations as liens in case of foreclosure.  Reason being, they are not Superior and get wiped during the foreclosure process.  Therefore, ensure you search all databases in the County for your property to seek these out.  

We recently bought a property from auction in Miami, had a "pencil search" done in advance by EasyTitleSearch.com, and thought coast was clear.  However, upon the impending sale, Seller's Title Co discovered dozens of violations, that didn't appear on any title searches.  We had checked for building violations beforehand which turned up NIL, but ended up with $28K of violations from the Animal Services department as the previous Owner was raising and selling dogs illegally all over the city.  Each infraction he received got tied back to the property.  What a nightmare!  

@David Sicherman (no offense, but unrecorded violations don't show up on searches, as you know)

absolutely, if they aren't recorded you can't find them, municipal liens can be tracked down by doing a municipal lien search which is completely different service and can be way more expensive than a regular lien search.  There are services for municipal searches and they run about $75 and up. Most investors do not do these searches because they take way longer than a regulate title search, cost more, are rarer and are easily negotiated down with the municipality in most cases of these violations. 

Medium screen shot 2014 09 26 at 3.23.05 pmDavid Sicherman, PBCHomeAuctions | (855) 888‑4853 | http://www.EasyTitleSearch.com

Anyone can go to a county hall of records and conduct a search. Although there are many types of searches that title companies do as per the requirements of lenders such as a Mortgage and deed search, owners record search, tax search lien search etc.. These searches are done with a history of 60 years which everything is copied and provided in the title search report..... then an underwriter examines all the searches and looks for defects if property is clean title insurance policy is produced which is called a commitment . But as far as your question can anyone do a search yes but your time is more probably more valuable doing other things.
After compiling all the data it’s time to review. Let’s say you are looking through all the details about mortgages on a subject property you want to make sure all mortgages are satisfied if a mortgage in the history chain wasn’t satisfied it’s a defect until cleared up. Maybe contacted the lender and getting a satisfied letter is all that’s needed to clear that up also under liens if you find a mechanics lien that would have to be rectified as well. There are many things that can raise red flags

@David Sicherman  - upon reading your signature, I see you do have the word "all" just in front of "liens"; seems @Chad Urbshott  is pointing out an over promise or under deliver ...

@Steve Babiak  One can only find liens if they are recorded in official records, there's no lien searches that include calling municipalities, hence why this is a separate service that takes much longer and a municipal search cost more than an O & E report.  Technically it's not even a "lien" until it is filed with the county, so I stand behind the fact that we will find all liens in official record.  Basically what you are dealing with unfiled municipality stuff are unpaid utility bills that haven't become liens yet, zoning violations as 99% of the time even the special assessments are filed in a timely manner with official records.

Short of doing a full title search which will run you $100's or doing an O & E and a muni search which will run you over $100 too, there's no way to take the risk out of the biz, and if you are doing 100's of searches a month like many of our clients, anything more than an O & E search isn't cost feasible, and everything other than utility bills can be negotiated for pennies on the dollar if you purchase the property.

Medium screen shot 2014 09 26 at 3.23.05 pmDavid Sicherman, PBCHomeAuctions | (855) 888‑4853 | http://www.EasyTitleSearch.com

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@Jose Diaz  

first off, the answer is no, you can't search as well as a title company and no one in this thread can, not a slam to knowledge, but I'd question that, but as to capabilities and resources as well as specialized legal training, I don't see any title attorneys posting here nor any examiners, just some thinking they can. I have had some training, but I'm not qualified either, so I go in the same boat as everyone else.

Can you search inheritance matters, are you familiar with lineage, can you find death certificates and marriages, what do you do with a reversionary deed with dead beneficiaries?

Just searching names in public records isn't an abstract, catching spelling mistakes isn't an abstract and unless you're an attorney or have had legal training (that means formal in a school for examiners or by a title insurance company for agents, not some guru course) then you won't know what insurable interests may exist or interests that may arise as the basis of claims in or to title.

Ever hear of people getting remarried, the married, got a divorce, executed a deed, then later remarried, then died......trust me, not only will you not be pulling from appropriate records, you will probably won't know the next step to search for possibilities that could exist. Liens are elementary, and liens not properly filed are exemptions from coverage under Schedule BII  of an ALTA standard policy. 

Not all public records are free on line and offices charge for burning copies, title examiners pay a different fee and have greater access to historical records than someone off the street, so even if you tried it's not going to be free and it may not be cheap while you get copies or pull data that later you find to be irrelevant to title.

Laypersons can check names in title and search liens, but beyond that you can't do an abstract of title.

The unmentioned obvious agenda of trying is to avoid title insurance in some quick flip, that depends on the past search, next buyer's search, what title companies might be on the hook, what deeds were used, the type of property, length of prior ownership, if any construction was done and other factors need to be carefully assessed before you try to avoid a title policy fee that you can probably obtain at a discounted rate or at a negotiated coverage amount. Your exposure from holding title lasts forever and then may run to your heirs through your estate. Better be very careful about running naked through a transaction without coverage.....and getting coverage comes with a proper title examination, so why would you even try?   

Medium logoscopiccroppedblue2Bill Gulley, General Real Estate Academy | https://generalrealestateacademy.com

@Bill Gulley  

I usually avoid discussions like this, I get asked this question all the time and sometimes threads on this subject can go on and on. But you nailed it. I've been abstracting and examining for 26 years and still catch something new all too often. I realize that I'm way late to this party, I'm new on BP, but the liability never changes. If you don't know what you're doing, pay the professionals. Too much can go bad. If a mistake is made, it's our liability.

Happy Investing

@Steve Bradigan  Good to have you here then!

You understand what I'm saying! Even the pros screw up, not often, but everyone does.

Folks gotta know their limitations, you can't be a specialist in everything!

I may have sounded a bit harsh, but geeez, thoughts get pretty wild here. :)

Medium logoscopiccroppedblue2Bill Gulley, General Real Estate Academy | https://generalrealestateacademy.com

Always hire a title company or an attorney depending what the rules in your state are to conduct your title search and or closing. Don't be foolish, you are investing a significant amount money, no lay person without legal experience can determine what is a valid lien or not. Some liens are good for 5 years, some for 10 and some until it's paid off. Depending on your state sometimes water and sewer liens are not recorded at the court house, you have to contact the water and sewer company to determine what's owed, because water and sewer liens run with the property and not the owner of the property. Meaning if you buy a property that owner owes 1,000.00 for water and sewer and the owner doesn't pay it, the new owner will have to pay it. In Pennsylvania, inheritance taxes are a lien against a property if not paid within 9 months of date of death. If you search the court house records you will never see a lien for inheritance taxes however, it's an automatic lien until paid. The lay person will never know all the laws pertaining to mortgages, liens, domestic relations support for children, judgments, bankruptcy, lis pendens, mechanics claim liens, estates, probate of wills, estates with no wills, administrators and trustee of trusts. My point is to spend the money on a title search and if the title company makes a mistake, you will be covered if you get title insurance.

Here is the real world fact: title companies make mistakes, too.

Title insurance company's job us to sell you title insurance policy and make a profit, while eliminating or at least minimizing their exposure to risk. That's it.

I've never submitted a claim to a title insurance company (so far). That's a fact.

Also, I'm considered a fairly savvy title expert by the legal and real estate community in CA and have spoken to many, many legal groups (Bar assoc., etc.) and I still make mistakes sometimes. I'm far from perfect. 

I have proven to my one satisfaction that there is great value in understanding title. Thus includes title theory, documentation and my state's recording laws. My friend award Hanigan was the first person besides John Beck who shared my enthusiasm for title research and told me about buying the Examiner's Manual every year or two from the CA County Recorders Association. 

There's also great value in recognizing problems both from a risk and cautionary basis but also profitable solutions and to better assign value to the services I offer. 

Lastly, my strategy is to buy the cheap research to vet opportunities and then spend time and/or money on researching the deals that I wish to move forward on. Whether you learn to do the research yourself, delegate it or outsource it, there is a certain amount of risk, especially when in a time crunch. 

Best to understand how it works and assess the value of the research and forget the people who tell you that you absolutely have to do this or that.

Well, that's great Rick, but, you're still not qualified to abstract titles. I was at a bar association meeting last night for dinner, the attorney I sat across from even bought me a drink, by the time it was my turn to buy, the other attorney next to me had to go. Lucky I had my boots on   :)

Medium logoscopiccroppedblue2Bill Gulley, General Real Estate Academy | https://generalrealestateacademy.com

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