Undestanding the purpose of title clearance at closing

| Feb 9, 2021 | Real Estate Transactions | 0 comments

Buying a home in Florida is an exciting accomplishment for many people. The moment a title transfers into their name, they officially own their new home.

The process for getting a title transferred from one owner to another requires time and research. Without title clearance, issues may arise later on which can compromise the owner’s rights and cause frustrating and costly legal battles.

Choosing a title company

People buying real estate have the right to select the title company they want to use for title clearance. According to Realtor, people should verify that prospective title companies have a license. They can also read reviews of past clients to better understand if a certain title company will meet their expectations.

A successful title clearance verifies the legitimacy of the person selling the property. This provides reassurance to the buyer that once the title transfers into their name, they are the legal owner. Once cleared, the buyer does not have to worry about another party coming forward to claim the property belongs to them and was wrongfully sold.

Completing the title search

Title companies follow a rigorous process to verify the legitimacy of property ownership. According to Zillow, title companies analyze property records. They look for prior issues with the property which may include the following:

  • Judgments
  • Easements
  • Outstanding mortgages
  • Restrictions
  • Liens

They may also conduct a property survey to establish clear property boundaries. The outcome of this analysis provides buyers with a legitimate record of property ownership. Once cleared, the process of transferring a title from the seller to the buyer can begin.