Abstract of Title in Real Estate:
An abstract of title is a typed or written history of all the recorded documents affecting the transfer of ownership and all legal proceedings related to a specific piece of real estate. It is also sometimes referred to as an Abstract of Title. These documents are created when a title company, title searcher, abstractor or attorney researches all the recorded records related to a property and prepare a written history of the transfer of ownership of it. Often it is typed.
What is an Abstract of Title useful for?
When purchasing real estate every buyer is concerned with liens or other problems with the title to the property you don’t know about. If you’re going to buy a home with liens on it you at least want to know how much they are and to whom they are owed. In addition to liens, you will also want to know the exact size and shape of the property you are buying. That is why in addition to an Abstract of Title you also want a Survey of the Property. A professional title examiner, often an attorney or a title insurance company can review the Abstract of Title and the Survey and give you an opinion as to the title to the real estate and in some case will offer to issue an insurance commitment of insurance or policy ensuring title to the property for the value of the property.
What Kind of Stuff Could Be Found
The Abstract of Title can be a thick packet and numerous pages. Often there are local standards as to the number of years of the history of the property should be followed in the abstract. Usually, it is for nearly 100 years, but can be more. Typical issues that arise and cause concern to examiners of Abstracts of Title are:
- Liens: Mechanic and repair liens, or liens for monies borrowed against the property, second mortgage, etc.
- Tax liens: If property taxes are in arrears, there could be tax liens on the property. They take precedence over other liens and you can lose the property if they’re not paid.
- HOA liens: If you don’t pay your HOA dues they can put a lien against the property.
- HOA restrictions and covenants: You need to know what you can and cannot do with or on your property, so these are important rules to read, as you’re bound by them.
- Surveys and notes: If there are encroachments on your property, they will show up in surveyor notes. An example would be the neighbor building a new fence a foot into your property line.
- Easements: There are often easements for utilities. Often worded as a certain number of feet along a property line is reserved for installation and repair of sewer, water lines, etc. You don’t want to build a deck over this space, as the easement allows the utility to tear it up to do their work.
As you can see, an abstract of title is an important document to understand and seek professional advice to examine. At my office, we are very familiar with reviewing and analyzing Abstracts of Title and Surveys. If you have more questions, please call us.