Performing a title search is a crucial step in any real estate transaction. It involves examining public records to confirm that the property being bought or sold has a clear title, free of encumbrances and legal issues. Even experienced professionals can make missteps during this process, which may cause costly problems later. Below are five common mistakes to avoid—and how to prevent them.
1. Neglecting to Conduct a Thorough Search
One of the most frequent errors in a title search is failing to conduct a comprehensive review of all relevant records. Relying solely on online databases or skipping documents you assume are irrelevant can lead to missed liens, easements, covenants, caveats, or other encumbrances that affect ownership and use. A careful search should trace the chain of title and include deeds, mortgages, tax records, easements, restrictive covenants, and any recorded plans or instruments. Overlooking even a single document can create future disputes or delays.
2. Not Verifying Property Boundaries
Boundary discrepancies are a common source of conflict. Errors in legal descriptions or inconsistencies between recorded documents and the physical site can result in encroachments or disputes with neighbors. Review survey plans and legal descriptions carefully, and, where practical, arrange a physical inspection to confirm that fences, structures, and improvements align with the legal boundaries. Understanding easements—formal rights allowing others limited use of the land—is also essential; see a primer on easements to appreciate how they may affect access and use.
3. Overlooking Outstanding Liens or Judgments
Failing to identify outstanding financial obligations tied to the property is a serious oversight. Liens can include unpaid council rates or taxes, mortgages, homeowner/strata levies, or contractor claims. If not resolved before settlement, these liabilities can transfer to the new owner. Investigate all recorded liens and judgments thoroughly, verify payoffs with the relevant authorities or lenders, and ensure they are released before completion. For a quick refresher on how liens work, see this overview of property liens.
4. Ignoring Title Insurance
Some buyers and sellers undervalue title insurance or forgo it to cut costs. Title insurance can protect against unknown defects that surface after settlement—such as errors in public records, fraud, or undiscovered encumbrances. Without it, parties may face significant legal expenses or financial losses if a defect emerges later. Learn more about the protection it offers here: title insurance.
5. Failing to Seek Professional Assistance
Attempting a title search without expert guidance is risky. Real estate law and land registration systems are complex, and small omissions can have major consequences. Engage a qualified title examiner, licensed conveyancer, or real estate attorney to help identify issues early, interpret legal descriptions, and guide you through resolutions. For general guidance on professional support during a property purchase, see Moneysmart’s home-buying resources or locate a practitioner via the Australian Institute of Conveyancers.
Conclusion
A meticulous title search calls for attention to detail, good recordkeeping, and a clear understanding of real property law. By conducting a comprehensive review, verifying boundaries, identifying and clearing liens, considering title insurance, and engaging qualified professionals, buyers and sellers can streamline the process and protect their interests. Investing the time and care upfront helps ensure a smooth, secure, and successful property transaction.
