A title review is important in a real estate transaction for several reasons:
First, a title review helps identify the legal owner of the property and their right to sell. This in turn helps avoid future disputes or legal issues regarding ownership. Also, it would help identify any encumbrances or liens on the property, such as mortgages, unpaid taxes, or other claims against the property. Knowing about these issues upfront allows the buyer and seller to resolve such issues in order to ensure a clean title transfer.
Many lenders require a title review to ensure the property being purchased can be used as collateral for the mortgage. Lenders want to ensure that there are no outstanding claims against the property that could jeopardize their investment. By conducting a title review, the buyer can make sure the prospective property is free from known or unknown legal issues. This would protect their investment and give peace of mind about acquiring a property with a clear title.
Overall, a title review is crucial in a real estate transaction to ensure a smooth transfer of ownership, identify any potential issues, protect the buyer’s investment, and comply with legal requirements.