Procedure of Title Examination and its importance
What is an examination of a Title?
Title examination is one of the key elements in every real estate transactions. It ensures that the title to a property is appropriate for sale. It looks to see if there is any encumbrance on the property. An encumbrance can be defined as anything that could disturb the sale of the property, such as unpaid tax liens or any restrictions placed on the property. It also reviews the history of possession, including all trusts documents, will and deeds associated with the property in the past.  This is called reviewing the chain of the title which determines whether the property's ownership is legitimate to be tied to anyone other than the current buyer and seller.

When does it take place?
Title examination occurs while a land is under contract. During this phase, the potential buyer and the seller undergo various rounds of negotiations and inspections that could last up until the closing date. If any inappropriate thing is figured out, the buyer backs out from the process. Examining the title is thus the most important part of this process. If not reviewed properly, the buyer could end up purchasing a property that is not legitimately sold.

Who conducts it?
A title company or qualified attorney reviews the title. Either one of these sources are entitled to a title examination fee. The cost of an examination may fall on the buyer or even the seller, depending on the terms of the negotiation which took place between them.

Why is it done?
Performing a thorough examination is one of the most vital parts of closing services, for several reasons. Whenever property changes its ownership, you have to ensure that the seller is the sole owner of the property and there are no title defects (also known as title clouds) involved. If the property owner owes any form of back taxes or homeowner’s association dues, legal liens can be filed against the title that must be resolved before the property can be sold. In many of the cases, surprise heirs show up claiming the legal possession. More to it, Forgery is also a common form of fraud when it comes to obtaining signatures on legal documents. Clerical errors like typos or delinquent paperwork can also delay a real estate transaction if not reviewed on time. For all these potential errors, making an investment in title insurance to protect from paying unexpected legal expenses in the event of a title dispute is always recommendable.

Thus, we see that dealing with a real estate closing service is a sensitive issue and requires huge amount of care and consideration. Most of the people buy or sell real estate a few times in their lifetime, and it is essential that they employ professionals whom they can trust, and who are accessible to them at every step of the way.

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