A recognized owner of the real estate and that there are no unsettled liens or other claims against the property.

Sometimes there are errors on title that need to be fixed. You should always keep any and all deeds or Quick Claim deeds on file in case your mortgage needs to be modified. These documents will prove helpful to correct title issues and save a lot of headaches for borrowers in the long run.

A title search is required in all mortgage transactions.

In order to trace a property's chain of title, a title company examiner searchers the records of the county recorder, county assessor, and the the government taxing agencies to locate any and all documents which might affect the title to a given property.

In his search, the title examiner has four primary determinations to make:

• The Exact description of the property


• The estate or interest of the property


• The vesting of the estate of interest; and


• The exceptions (liens, encumbrances, and defects) affecting the particular vested interest.
  

Once a title company has determined clear title they will issue what is called a title policy. This policy is insurance to protect the buyer of the property from any person or entity that might claim a lien or encumbrance against the property after the sale. This policy is an important part of the real estate transaction and should always be bought. In fact almost all lenders will require a title policy to protect their lien position in the property.

Due to the increasing risk of fraud that involves a property's deed and title, title search (and title insurance) has become more and more important. Even in the case that a homeowner purchases a property outright (therefore no mortgagee requiring title search and title insurance), it is prudent that the homeowner conducts title search and carries title insurance to protect what may potentially be his largest investment in life.