Ownership and Encumbrance Title Report

An Ownership and Obligation The Title Report confirms the current owner(s) of the property from the time of the previous purchase to the most recent effective date listed in the property records. It also lists any judgments and mortgages that have not been released and gives tax status (where available).

An Ownership and Encumbrance (O&E) search is a comprehensive investigation into the title of a property, aimed at identifying the current legal owner and any potential encumbrances that may affect the property's title. This search is an essential part of the due diligence process in real estate transactions, whether you're buying, selling, or refinancing a property. It provides critical information about the property's ownership history, any existing liens, mortgages, easements, or legal claims, ensuring that you are fully informed before proceeding with any real estate decision.

Why is an Ownership and Encumbrance Search Important?

The O&E search is designed to uncover any issues that may affect the property's transfer, value, or ownership rights. Without this search, a buyer or lender could unknowingly assume responsibility for financial obligations, legal disputes, or other complications related to the property. This search gives you the peace of mind needed to proceed with your real estate transaction confidently, knowing that there are no hidden risks.

Key Aspects of an Ownership and Encumbrance (O&E) Search

1. Ownership Verification: The O&E search begins by confirming the current legal owner of the property. This is vital for ensuring that the seller has the legal right to transfer the property and that there are no ownership disputes.
2. Identification of Encumbrances: One of the primary purposes of an O&E search is to identify any encumbrances or claims against the property. These may include:Mortgages: Any outstanding loans or liens that are attached to the property.
   Liens: These could be tax liens, mechanic's liens, or judgment liens that might affect the property's title.
   Easements: Rights of access granted to others, such as utility companies or neighbors.
   Covenants and Restrictions: Legal restrictions on how the property can be used, often imposed by homeowners' associations or other governing bodies.
   
3. Legal Claims and Judgments: The O&E search also looks for any legal claims, lawsuits, or judgments filed against the property that could affect ownership or result in financial liabilities.
4. Property History and Transfers: A comprehensive O&E search will review the property's history, including any past transfers of ownership. This can help uncover any potential issues with previous sales or ownership claims.
5. Tax Information: The search will also verify the current tax status of the property, ensuring there are no unpaid taxes that could lead to liens or foreclosure.

Benefits of an Ownership and Encumbrance Search

• Clear Ownership: Ensures that the seller has the right to sell the property and there are no disputes regarding ownership.
• Identifies Financial Risks: Uncovers outstanding mortgages, liens, or judgments that may need to be resolved before the transaction can proceed.
• Reduces Legal Risks: Prevents you from unknowingly taking on legal liabilities or complications related to the property, such as unresolved claims or easements that could impact its use or value.
• Informs Financing Decisions: Lenders often require an O&E search to ensure the property is free of any encumbrances that could complicate a loan or mortgage process.

When is an Ownership and Encumbrance Search Required?

An O&E search is typically required in the following situations:

• Property Purchases: If you are buying a home, commercial property, or land, an O&E search provides a clear picture of the property's ownership and any encumbrances that could affect the sale.
• Mortgage Lending: Lenders require an O&E search before approving a loan to ensure the property’s title is clear of issues that could jeopardize the loan’s security.
• Refinancing: When refinancing a property, an O&E search is necessary to confirm that the title is free of encumbrances that could affect the new loan agreement.
• Property Sales: Sellers may also request an O&E search to ensure there are no hidden title issues that could complicate the sale.