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When buying a new house or property, there are many factors to consider. Home insurance, mortgage, interest rates, property tax…the list goes on. 

A title search is another important task to consider when buying a house. For any real estate transaction to succeed, a title search is necessary for both the buyer and seller. 

In this article, we’ll discuss the types of issues that you can uncover through a title search, as well as the steps to perform a title search on a property.

Key Points

  • A title search involves researching the title of a property to uncover potential issues and ownership claims before a sale is completed.
  • Title searches can be performed by anyone, including title search firms, lawyers, and individuals.
  • Before a real estate transaction can be finalized, the title of a property must be free of issues. 
  • Title insurance can also be purchased for financial protection if issues are discovered on the title of a property.

What Is A Title Search?

A title search is the process of researching and reviewing public records to determine a property’s legal ownership. Public records that may be searched include deeds, county land records, tax liens, divorce cases, and various other court records. 

A title search is important before finalizing the purchase of a home. It can tell you if there are any claims or liens on the title and will confirm that you are the rightful owner of the property after your real estate transaction is complete. 

Who Does A Title Search? 

Usually performed by a title company or a lawyer, a title search is done on behalf of the buyer interested in a property, or who has already purchased a property. Mortgage lenders have also been known to conduct title searches in the past to verify ownership of a property 

Can I Do A Title Search On My Own?

Most people will have an attorney carry out the process. However, you can conduct a title search on your own, in one of two ways:

Electronic Title Search

This is the fastest and most convenient way to conduct a title search and will provide results within a few hours. The property must be registered in the electronic database to search this way. Most properties in larger centres are typically available for electronic searching.

Here are a few websites you can use to conduct an electronic title search:

Manual Title Search

This is a much longer and more expensive process that requires a lot of documentation. Many properties in more rural parts are typically not available for electronic searching, so a manual search would be your only option. To perform a manual search, you’ll need to: 

  1. Obtain the property’s legal description (found on property tax statements)
  2. Go to the local Land Registry office, Recorder’s Office or Office of the Examiner of Titles with the legal description.
  3. Request public access to records and look up the legal description
  4. Interpret the records yourself, or with a lawyer, to determine the property’s status

Despite the fact that it is indeed possible to conduct a title search on your own, most experts recommend against it. A lawyer is usually more prepared to handle all of the legal jargon and details within the records. It’s not worth trying to save a couple of hundred dollars if it will risk you exposing yourself to the potential for much more expensive issues if there’s a problem with the title

Documents Required To Perform A Title Search On A Property

Regardless of which way you perform a title search, you’ll need one of the following:

  • Property Identification Number (PIN). Having the PIN of a property is the fastest and most accurate way to conduct a title search. You can find the PIN on property tax assessment documents.
  • Exact municipal address. Another quick way to find a property is by municipal address, though not all properties in electronic databases are entered by municipal address. 
  • Legal description. If the property is not entered by municipal address, you may be able to search by its legal description, though these are often not listed in electronic databases. In this case, you may have to go the manual route.
  • Property owner’s name. You’ll need the exact spelling of the owner’s name. If you search this way, you’ll find all properties within the land registry office that the owner has an interest in.

Once you find the information you’re looking for, you’ll need to interpret the records yourself, or with a lawyer, to determine the property’s status.

How Much Does A Title Search Cost In Canada?

The cost of a title search can differ on a case-by-case basis, depending on a handful of factors, such as the size, type, and location of the property, as well as the mortgage amount. 

Generally, if you’re doing the title search yourself, you’ll pay between $70 to $95 for an electronic search, or between $10 to $200 for a manual search. You’ll pay more to have a professional conduct the title search on your behalf. 

When closing a deal on a house, you will usually pay a one-time fee for title insurance, which often covers the cost of a title search. 

Why Does A Title Search Need To Be Performed?

It’s in the best interests of both buyers and sellers to have a title search conducted. A title search will provide important information about the subject property, such as the following:

Registered Owner(s)

Someone can try to sell a home that they don’t legally own, whether they know it or not. If the seller doesn’t have the legal authority to sell the property, the buyer won’t become the legal owner after a sale is finalized and the deed is registered.

Legal Description Of The Property

The agreement of purchase and sale will include a legal description of the property, including dimensions. A title search would discover whether the dimensions of the property are specified on the purchase agreement match the dimensions as per the title. Otherwise, a buyer could wind up with a smaller property than they thought they were getting if the agreement says the lot is larger than it truly is. 

Liens

Various liens can be placed on a property’s title, such as property tax liens, construction liens, and child support liens, among others. A lien on title represents a legal claim on a property if the owner has outstanding debts to pay. 

Until the property owner pays off their debts, the lien will remain on title. That means the lienholder can retain possession until the debt is repaid. If these liens are not discharged before the title is transferred, the buyer may experience trouble obtaining financing.

Easements And Rights Of Way

An easement is a legal right to use another person’s property for a specific purpose. This is how utility companies enter properties when performing work. A right of way is the legal right for someone to cross a specific route on someone else’s property to get to another site, such as a shared driveway. Buyers need to be aware of the presence of easements and rights of way on a property, which a title search will uncover. 

Restrictive Covenants

Restrictive covenants prevent property owners from carrying out certain activities on their property. These covenants are registered on title and are legally binding not just to the current owner of the property, but any future buyers. For instance, a covenant may restrict owners from modifying the grading of the property or even installing a pool. 

Title Defects

For the seller, title searches can ensure there are no defects that could result in someone challenging their right to the property. A defect can look like someone claiming the property is their own or claiming that the seller never owned the property. If you have a “marketable title,” it means that there are no defects. 

What Is Title Insurance?

While a title search is meant to discover potential issues with a title, it’s still possible to miss something. Whether you perform the title search on your own or hire a professional, something may be overlooked. 

Unfortunately, these mishaps can prove costly if a real estate transaction is completed, only for the new owner to find a problem with the title. This is where title insurance comes in. Buyers typically purchase title insurance to protect themselves from financial loss if an issue with the title pops up after the sale.

Title insurance ensures buyers are protected against financial loss or damage resulting from any issues in a property’s title. While most insurance policies cover loss associated with future events, it’s interesting to note that title insurance protects against claims from the past. 

Benefits Of Buying Title Insurance

A basic title insurance policy usually protects property owners against the following hazards arising from a title search:

  • Terms that minimize property value or enjoyment, such as unrecorded easements
  • Incorrect or forged signatures and fraudulent information on title documents
  • Flawed or incorrect record-keeping
  • Ownership by another party
  • Outstanding lawsuits or liens

Learn everything you need to know about buying property in the U.S as a Canadian.

Final Thoughts

Title searches protect the sellers and buyers in case of financial loss and issues resulting from a property sale. Although not all titles have issues, the cost of not addressing title issues before a sale can be financially disastrous for buyers and sellers. When making such an expensive purchase, it’s better to play it safe and be prepared by performing a title search on a property.

Frequently Asked Questions

Can anyone do a title search on a property in Canada?

Yes, anyone can search for land records and obtain a title search. In Canada, land ownership is registered in a provincial Land Title Office. This information is considered a matter of public record, anyone can access it.

How long does it take to do a title search?

The fastest way to conduct a title search is electronically. You’ll usually have the results within a few hours, depending on the property’s location. If you perform the search manually, the process can take a few days to a couple of weeks.

What’s the difference between a title search and title insurance?

A title search is a process that involves uncovering issues with the title of a property, such as liens or potential fraud in ownership. Title insurance can be purchased when buying a home for financial protection if defects are found on the title.

Do I need a title search if I’m refinancing my mortgage?

Lenders will typically require a title search when you refinance your mortgage. This is because your lender will want to see if any problems could make your property difficult to sell if you default on your loan.

Note: Loans Canada does not arrange, underwrite or broker mortgages. We are a simple referral service.

Chrissy Kapralos avatar on Loans Canada
Chrissy Kapralos

Chrissy is a Toronto-based communications advisor. With an English degree from the University of Toronto and editing courses under her belt from Ryerson University, she has continued her lifelong passion for writing and editing. In addition to working for Loans Canada on a variety of financial topics, Chrissy has a few years of resume writing and editing under her belt, and takes great pleasure in helping people find work that fits with their experience and passions. When she isn't working, you can find her practicing yoga, hanging out with her dog, reading up on financial and real estate news, or planning her next trip abroad.

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