It's important for homebuyers to do a title search before buying a house. This process helps find out if there are any problems with the property that could affect the buyer's ownership rights in the future. However, doing a title search in Texas can be confusing, especially for people who are buying a house for the first time.
In this blog, we’ll talk about some common mistakes people make when doing a Texas title search as well as answering some frequently asked questions about title searches in Texas.
TABLE OF CONTENTS
What is a Title Search?
A title search is a necessary procedure employed to confirm the legal ownership of a property. This process entails thoroughly investigating public records and acquiring pertinent documents that outline the property's historical background, including deeds, mortgages, liens, and other relevant records that may impact ownership.
The purpose of the title search is to ensure that the seller has a clear title to the property and that there are no outstanding claims or encumbrances on it.
How To Do a Title Search in Texas?
Title searches are normally done by title search companies or an attorney, but this can also be done by individuals. If you're considering doing a title search on your own, you'll have to search property records in your clerk county's office. Experts do not advise conducting your own title search as this requires a vast knowledge of real estate requirements and will require professional conduct and review.
Hence, it's best to ask for help from professionals when it comes to conducting title searches. The findings of a title search can then be utilized to secure title insurance for the buyer.
How Much Does a Title Search Cost?
The cost of a title search for residential properties usually falls within the range of $75 to $250, taking into account various factors such as the property's location. It is customary for the current owner to cover this expense as part of their selling costs.
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Title Search Mistakes to Avoid
Title search mistakes can be costly, so it is important to understand the basics of how a title search works in Texas. Here are some of the title search mistakes you need to avoid:
Not Understanding What A Title Search Is
Some people mistake a title search for a home inspection. While both are essential, they serve different purposes. A house inspection is done to evaluate the structural integrity of a building, and a title search allows buyers to verify the ownership of a property. If a buyer fails to do a title search, they may find out later that the property has legal issues or debts that can hinder their ownership rights or even cause them to lose the property altogether.
Not Using A Reputable Title Company
A title company can be a valuable asset when it comes to conducting a title search. They can provide the buyer with accurate information on the property such as outstanding mortgages, unpaid debts, and legal disputes. However, choosing the wrong title company can lead to pitfalls. Conduct your own research, read reviews, and ask for referrals before deciding which title company to trust with your title search.
Not Reviewing The Title Search Results Carefully
Title search results can be intimidating to a first-time homebuyer. They are usually full of legal jargon and can be confusing to interpret. However, buyers need to review the title search results carefully to ensure that everything is in order. Focus on any red flags, like unpaid taxes or liens, and consult with your title company if you have any questions.
Not Understanding Title Insurance
Title insurance is a must-have for every homebuyer. It protects the buyer and the lender from any unforeseen issues that may arise with the ownership of the property after closing. In Texas, the buyer must pay for title insurance, which can range from $238 to $875 for policies up to 100,000 based on the Texas Department of Insurance. The basic premium of title insurance will greatly depend on the type of policy that will be purchased. Buyers must carefully understand the terms and conditions of the title insurance policy they are purchasing.
Rushing Through The Process
A title search can take several days or even weeks to complete. Some buyers, especially first-time homebuyers, make the mistake of rushing through the title search process. This can lead to mistakes that could be costly to fix. Taking the time to review the title search results carefully, consulting with experts, and doing your due diligence can prevent costly mistakes down the line.
Title Search in Texas
Conducting a title search is a crucial aspect of purchasing a property in Texas. As a homebuyer, you need to avoid the top mistakes when performing a title search, such as not understanding what a title search is, not using a reputable title company, not reviewing the results carefully, not understanding title insurance, and rushing through the process.
By avoiding these mistakes, you can feel confident that you are making an informed decision when purchasing your property in Texas.
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