5 Reasons to Check Property Records Before Buying a House

May 7th 2016

Whether you're looking at buying a condo or a ranch, or anything in between, thoroughly checking property records is important before you finalize your offer. Knowing the details of the property helps you to pay the right price for the right place and avoid expensive mistakes and legal issues.

Paying the Right Price

A full property search shows all matters of public record and can help you tailor your offer. Properties being sold as part of divorce proceedings, short sales and pending foreclosures are markers that can trigger a lower offer being accepted, and you should take these types of things into account when framing your offer.

Awareness of Encumbrances

While the owner of record for a property usually has the right to sell it, if there are encumbrances such as mortgages, liens, easements or title restrictions, the sale may not be straightforward. Legal issues can slow down a sale in these cases, and in a few rare instances, as the new owner, you may even find yourself liable to pay debts that are settled on the property. It's therefore worth being aware of any outstanding encumbrances before committing to a purchase.

Legal Matters

Checking the tax records for a property turns up the original age of the home, type of roof it had when last assessed for tax and the number of rooms. In particular, pay attention to the square footage listed in these records. If this differs from the agent's particulars, check to see which is correct. There may have been an honest mistake at either end, but there is also a chance that the property has had extensions for which no permits have been granted. This type of unregulated expansion can cause issues further down the line, so it's worth talking to the vendor and city hall to find out the full situation with regard to permits before purchasing.

Fixing Issues

There is a good chance that the property has issues, according to Home Closing 101, which figures that more than a third of all title searches bring up issues that must be resolved before a sale can proceed. The organization recommends hiring a title professional to perform the searches in order to fix small issues as they arise, but even if you've done your own searches, title professionals can help resolve debt and other legal issues attached to the title. This is a good option if you still want to buy a property even though there are problems with it. In these cases, it's worth considering asking for a discount on the selling price to reflect any charges or fees incurred.

Land Use

If your new home has any significant amount of land under cultivation or used by animals, it's even more important to perform thorough property record checks. Water use and issues can be very important, and you need to know whether the land has been treated conventionally or organically, as this influences your own produce. Easements for access and irrigation can also affect your relationships with the neighbors. Note these in advance so that you can uphold any obligations.

Conclusion

Buying a house is an exciting time, but it's important not to get carried away and forget to perform due diligence. Before making a final offer on a house, check the property records for the building and land.

Sources

About.com "How to search property records" http://homebuying.about.com/od/marketfactstrends/qt/0407PropSearch.htm
HomeClosing101.org "Why you need title insurance" http://www.homeclosing101.org/whyneed.cfm
OregonState.edu "Top ten things I learned buying a small farm" http://smallfarms.oregonstate.edu/sfn/fall06topten

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