A title order in real estate is the formal request that kicks off a title company’s investigation into a property’s ownership history. Once placed, it sets in motion a search of public records for anything that could interfere with a clean transfer: unpaid debts attached to the land, restrictions on how it can be used, and errors in old documents. The results are packaged into a title commitment and, at closing, into the insurance policies that protect the lender and, if you buy one, you.
Who Places the Order and When
The order usually goes in within days of a signed purchase agreement and earnest money hitting escrow. In a financed deal, the lender typically submits it, because they need assurance the property is worth the loan behind it. In a cash purchase, the buyer or their attorney handles it. The title company needs the basics to open the file: the property address, the full names of everyone involved, and the transaction type, whether that’s a purchase, a refinance, or something else.
You are not stuck with whichever title company the seller suggests. Federal law prohibits a seller from requiring you to buy title insurance from a specific company when a federally related mortgage is involved.1Office of the Law Revision Counsel. 12 USC 2608 – Title Companies; Liability of Seller Local custom varies: in some markets the seller traditionally picks and pays, in others the buyer does. Either way, the Consumer Financial Protection Bureau encourages buyers to compare providers before choosing one.2Consumer Financial Protection Bureau. What Are Title Service Fees?
What the Search Looks For
A title search is a methodical review of county records. The examiner traces the chain of title, the sequence of recorded deeds showing how ownership passed from one party to the next. A gap or inconsistency in that chain is a red flag that has to be resolved before closing. The search also pulls mortgages, court records, and tax filings to build the full picture.
Liens
Liens are the most common finding. A lien is a legal claim a creditor records against the property to secure an unpaid debt, and it stays attached regardless of who owns the land. Unpaid property taxes from a prior owner remain a lien on the property after a sale. So do claims from contractors who did work and were never paid.3First American. Common Title Problems Covered by Title Insurance Judgment liens from lawsuits and the seller’s existing mortgage round out the financial claims that have to be resolved or paid off at closing.
Encumbrances and Easements
Not every finding involves money. Encumbrances limit how the property can be used. An easement might give a utility the right to run lines across your yard, or let a neighbor use a shared driveway. Restrictive covenants, often set by a homeowners association or the original developer, control what you can build and how you can use the land. These do not disappear at closing. They transfer with the property, which is why the search surfaces them before you sign.
Public Record Errors
County clerks generally confirm that documents are properly formatted and that fees were paid; they do not verify accuracy. Mistakes slip through. A misspelled name on a deed, an incorrect legal description, or a satisfaction of mortgage that was never actually recorded can all cloud the title.3First American. Common Title Problems Covered by Title Insurance Small errors, big headaches, if they cast doubt on who really owns the property.
Reading the Title Commitment
When the search wraps up, the title company issues a title commitment. It is a conditional promise: the company will issue a title insurance policy at closing, but only if certain conditions are met first. The commitment gives the buyer and the lender a clear snapshot of the title’s current condition and anything that needs fixing.
Schedule A
Schedule A lists the basic facts: the effective date of the commitment, the type and amount of insurance to be issued, the parties who will be insured, the current owner of record, and the legal description of the property. Check it carefully. Errors here cascade into every document that follows.
Schedule B
Schedule B is where the substance sits, in two parts. Part one lists requirements: conditions that have to be satisfied before the policy will issue. Paying off the seller’s existing mortgage is the most common, along with clearing liens and judgments. Part two lists exceptions: items the policy will not cover. Easements, restrictive covenants, and certain survey matters often appear as permanent exceptions. Read these closely, because they represent risks you are accepting without insurance protection.
Owner’s vs. Lender’s Title Insurance
The commitment usually references two policies, and plenty of first-time buyers don’t realize they do different jobs. Lenders almost always require a lender’s title insurance policy as a condition of the loan. It protects the lender’s financial interest only. If someone later shows up with a valid claim against the property, the lender’s policy covers the lender’s losses, not yours.4Consumer Financial Protection Bureau. What Is Lender’s Title Insurance?
An owner’s title insurance policy is separate and optional. It protects your equity if someone sues claiming an interest in the property from before you bought it: a previous owner’s unpaid taxes, an undisclosed heir, a forged document in the chain of title.5Consumer Financial Protection Bureau. What Is Owner’s Title Insurance? The owner’s policy lasts as long as you or your heirs own the property; the lender’s policy ends when the loan is paid off. Without an owner’s policy, you are the first person responsible for defending your ownership in court and absorbing any losses.
What Title Services Cost
Title service fees cover the search, the insurance premiums, and often the closing or settlement itself. These charges appear on page two of your Loan Estimate and Closing Disclosure. If the title services are listed in Section C of those documents, you can shop for a different provider.2Consumer Financial Protection Bureau. What Are Title Service Fees? If you decide to buy an owner’s policy, that cost shows up separately in Section H of your Loan Estimate, and buying both policies from the same provider usually costs less than splitting them.5Consumer Financial Protection Bureau. What Is Owner’s Title Insurance?
The total varies by location, property value, and how complicated the title history turns out to be. Search fees alone can run from under $100 to several hundred dollars for properties with messy records. Insurance premiums are typically calculated as a percentage of the purchase price or loan amount. Who pays which fee comes down to local custom and the purchase contract, so negotiate it early rather than late.
Clearing Problems Before Closing
When the search surfaces problems, they have to be cleared before the deal closes. Most issues are routine for an experienced title company. An old mortgage that was paid off but never formally released from public records is one of the most common findings; the fix is obtaining a lien release or satisfaction from the original creditor and recording it with the county. Outstanding tax and judgment liens get paid at or before closing, often directly from the seller’s proceeds. Recording errors like a misspelled name or an incomplete legal description can usually be corrected with a new deed or an affidavit. Boundary disputes, where a survey conflicts with the recorded description, may call for a new survey or a boundary line agreement between neighbors.3First American. Common Title Problems Covered by Title Insurance
When ownership itself is in dispute, say competing claims or unknown heirs surfacing, a quiet title action may be necessary. That is a lawsuit filed specifically to establish who owns the property, and a ruling in the plaintiff’s favor eliminates competing claims going forward. These take time and legal expense, which is why they are a last resort.
If Something Surfaces After Closing
Title insurance is for the scenario where a defect slips through the search and appears after you have already closed. If you hold an owner’s policy and a claim lands on your property, contact your title insurance company immediately. The insurer reviews the policy, investigates the claim, and determines whether it falls within your coverage. If it does, the company handles defense costs, works to clear the title, or compensates you for losses. If the claim is denied and you think the denial was wrong, you can appeal, and a real estate attorney is worth consulting for complex claims involving competing ownership interests or fraud. The practical takeaway: title insurance is not just a closing formality. You may need it years or decades later, so keep your closing documents and the policy somewhere you can actually find them.