Lining up a title company to conduct a title search may feel like just another item on the long checklist of things that need to be done in order to purchase your next fixer-upper, but it’s critically important.
To make a good investment you need to be sure that the person you’re buying this house from has a clear title to it. You don’t want to be paying someone who isn’t the actual owner of the property, whether they mistakenly think they’re the owner or they’re fraudulently trying to steal this money from the rightful owner. The whole concept of a title search can be confusing so let’s break it down…
You’re driving by and see a 2016 Ford Mustang GT parked in a driveway with a “For Sale” sign in the window. Out of curiosity, you walk up to the house and knock to find out how much they’re selling it for. When a guy finally comes to the door you say, “Is that your Mustang in the driveway? How much are you selling it for?”
He replies, “It’s my girlfriend’s car, but I’ll sell it to you for $15,000.”
That might cause you some concern, especially as you talk further and he refers to the owner of the car, his girlfriend, as his “ex” a couple of times. This isn’t right and even if you really want the Mustang, you don’t want to get into the middle of that. A person cannot legally sell you something they don’t actually own, and, yet, scenarios like this one happen in the real estate business more often than you might imagine. In 2016, The Washington Post reported, “In almost all real estate transactions, there are title issues that must be cleared up in order to transfer ownership of the home from the seller to the buyer.” To be sure you’re paying the actual owner of that fixer-upper, you need to find the best title company in Philadelphia to do a title search.
What Is A Title Search?
A title search examines the title history of a property, identifying any outstanding liens or other claims of ownership. Any issues found must be resolved in order to offer a “clear” title to the buyer. Thankfully, title companies will resolve a lot of the smaller issues behind the scenes or work with the present owner to clear up any outstanding issues.
What Else Do Title Companies Do?
When a title company gives the green light, that the title is clear for closing, they will issue title insurance to protect the buyer and lender against property claims or lawsuits over title disputes. Title companies also maintain escrow accounts and will ensure the proper transfer of money to close the real estate transaction.
So how do you find the best title company in Philadelphia? If you’re getting a hard money loan for your flip project from Legacy Capital, we’ll introduce you to the best title company in Philadelphia. Your peace of mind matters to us.