How to Read a Title Search

Reading Time: 5 minutes

First off, let's address why a Realtor, or even a homeowner, should know how to read a title search (aka a Parcel Register).

Because by doing so, you can get ahead of any problems that may arise before listing or selling a property.

It's great practice as a Realtor to pull a title search when your sign a new listing. For $35.68 and 15 minutes, you can avoid a pre-closing headache.

How to Obtain the Title Search

As Realtors you have access to GeoWarehouse. If you search a property there, you can scroll down to the bottom of the page to find this option:

If you click on the Parcel Register option, you can obtain a copy for $35.68.

If you don't have access to GeoWarehouse, anyone can obtain a Parcel Register through ONLand.

The document will look like this (without the redactions, of course):

Once you have your copy, you want to look for 3 key things.

Check the most recent "TRANSFER"

A Transfer indicates the owner of the property changed, in most cases this is a purchase and sale.

Look for the most recent Transfer (under Instrument Type) and ensure that the "PARTIES TO" are your clients. That means the last sale was from the previous owners, to the now current owners.

In most cases, you're here to ensure that you know exactly who is on title. Making sure you have the right people signing your Listing Agreement.

If there is a different set of names, there may be a BIG issue here.

Look for any current "CHARGE"

A Charge means a mortgage product. The lender (usually a bank) registers a Charge on the property to secure their money.

The Charge has an amount on it. This is the Amount the lender has secured their interest for.

You're looking to make sure that the amount listed is not higher (or too close) to the potential sale price.

Now, that being said, there are some things to keep in mind:

• The amount listed is the original mortgage amount. So a traditional mortgage that has been being paid down for multiple years, would require a much lower amount to pay it off.
• Some banks register for an intentionally higher amount than the mortgage because they include something like a Home Equity Line of Credit.
• Private Mortgages are often interest only, meaning the amount to pay it off will likely be higher than the stated amount.

The Charge is an important one, especially in falling markets. You're here to make sure there is enough money to pay off the mortgage and close the deal... and to ensure your commission will be there.

Review the Legal Description

Legal Descriptions are generally quite complex.

But there is one thing you can look for that will indicate whether you should perform a deeper search (or better yet, have a lawyer run a quick check).

You're looking for the term "S/T". Here's an example:

If you see the S/T, it means there is a potential easement or other property right that a third-party has in the property.

You should have a lawyer check the "Instrument" to ensure it will not affect the value of the property or potentially interfere with the sale.

– – –

You don't need to be an expert or catch everything, but checking these simple things can alert you when you might need help.

It should take you about 15 minutes.

And in most cases, you won't find anything concerning, which is good.

But for that one time you do find something - Catching an issue early can mean the difference between a successful sale and a deal falling apart. That one discovery can make all the difference.

Also remember, some lawyers don't like being involved in deals before they're firm... I take the opposite approach. The earlier we're involved, the more value we can provide to our clients in terms of preventing issues or solving them early.