What steps does a title company take to certify title?

Question

Can  you help me understand the step by step process a title company would  complete to certify title (provided title insurance) on a property that  is being purchased? In addition, what information do they need at each step, what is  the source of this info, and how long does it take to get.

Al Wilson · Answer

You may want to take your favorite title agent to lunch and pick his or her brain, but I think you will find that they have long since gone automated and that their processes are quite efficient.

Wayne Brooks · Answer

Our primary title searches, ownership and encumbrances (mortgages,liens,etc) come back in about 2 days, along with any conditions required to insure title (signatures of missed heirs on previous transactions, liens to be cured, etc) which has included searches of all public records.  The only steps in addition to that are written inquiries to HOA's for estoppels, and to local gov't dept.s that could have unrecorded liens (i.e. Code enforcement) and utilities depts.  These responses can take a week or two.  Not sure what your guys in TX do.

Matthew Kreitzer · Answer

Depends. Many localities are transitioning from a paper based system to online only. However, older records are typically no in most locality systems. It depends entirely on the individual jurisdiction. Everything a title search company does can be accomplished by a trained eye and sufficient time. Its just a matter of most of these companies having automated databases that archive information from the local courts. Different title companies operate differently, and many are not actually having the complete archived records. If anything, a trained eye with sufficient time is better than a title company. It is a matter of being a trained eye.

DISCLAIMER: Do not act on any of the above information. It is not legal advice. It is merely educational material. If you want to learn about title searches, take a class.

Rick H. · Answer

You are asking for someone to tell you how a multi billion dollar industry is run in a free online forum?

If you really want to understand, take a one-day training class on how to research title at a local county recorder (if you can find such a trainer).

Private parties use the county grantor/grantee index to first search for the property legal description and tax assessor's parcel number.

The researchers then uses the system to identify the acquisition deed and subsequent voluntary encumbrances (mortgages or trust deeds) associated with that owner. Then, involuntary liens are researched, including super priority property tax liens, code enforcement and other liens associated with the property. Lastly, the grantor/grantee index is searched for general liens associated with the record owner that attach to all assets, such as abstract of judgments or lawsuits (lis Pendens).

Title insurance companies use a private "title plant" which is a parallel data records system designed to work more efficiently for their needs. I had a private tour of First American Title's impressive facility in Santa Ana, along with a small group of Fannie Mae VIPs. Amazing.

Big investors subscribe to these title plants via services like TitlePoint for several thousand dollars a month per county.

Jeff D. · Answer

Thanks @Wayne Brooks!

Jeff D. · Answer

Well, assumption here is based on a friend who worked in a large title office here in the area. He shared with me that they used very limited technology in day to day operations. I ended up closing with that firm and it took several weeks to certify title on a seemingly straight forward transaction. Purpose of this post was to hopefully understand how others work through this process and see if there is any kind of need.

Wayne Brooks · Answer

Don't know why you'd think they're primitive.  I think you'll find they know what they're doing, and are much more efficient than something you'd put together.

Jeff D. · Answer

Yeah, I had planned to do that, but wanted to have a bit of context/ perspective from others before doing that.

Jeff D. · Answer

@Al Wilson are these county records publicly available online or are they mostly offline paper based archives. How about the title mills - are those some kind of internal, online database that a title company has access to?

Trying to better understand how this process works as I think believe it's still quite primitive and could be automated if the right data exists in the right format. I'd like to explore this further to see if it's an opportunity worth pursuing.

What steps does a title company take to certify title?

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