You’ve been looking for the right place in the right neighbourhood for quite a while now. Finally, you’ve found the home of your dreams. Before you sign and seal the agreement, it is important to have your lawyer perform what’s known as a title search on your soon-to-be new home.
Having a title search performed is for your own protection. Here are the top 5 reasons why this step should not be overlooked.
- Verify the current owners and anyone else
The first and foremost reason to have a title search performed is to validate that the current sellers are in fact, the true owners of the property. You will also be able to see how many times the property has changed hands. If it’s gone through numerous owners in a short amount of time, that could trigger alarm bells. It also will produce any other names that are connected to the home…like an uncle or aunt who might have co-signed back in the day and have never been removed from the title. The last thing you want to find out once you move in is that someone else is still connected to the property and can have a say in your ownership.
- Confirm the legal description and the property identifier number (PIN)
It may sound boring, but confirming the actual legal description and it’s corresponding PIN is an important legal step. For example, if the realtor made a typo in the Agreement and has inserted an incorrect number or description, it could mean that you don’t own that house, you could own nothing, or another property entirely. Having a survey as well is a great way to see for yourself the actual build site and where the property lines are.
- Are there easements on the property?
Another way to think about easements is the phrase “right of way”. To put it simply, let’s say your next-door neighbour ALSO has rights to use the driveway in order to access their property and/or the main road. If the driveway is between your two homes, then it’s quite likely your neighbour has access to it as much as you do. You’ll want to find this out just in case there are any issues such as a blocked driveway or driveway repairs.
- Are there any bylaws registered to the property?
Another important reason a title search is performed is to find out if the house has any bylaws registered to it. Bylaws, such as the home has historical significance tied to it, would mean you can’t renovate certain features or change the look of the home; it’s protected under the law. Or, is the home in a strictly residential area or is it allowed to have partial commercial use? Can you divide the property or lot? Can you rent out your basement? It is far better to find out about any bylaws before you purchase so that there are no surprises.
- Does the property have any liens against it?
Liens are “a right to keep possession of property belonging to another person until a debt owed by that person is paid.” By searching for any liens, you will discover all the registered mortgage(s) against the property and who issued said mortgage. If an undischarged mortgage is revealed for example, it will have to be discharged (paid) before you can close the deal. Another issue might be that the Canadian Government has a lien on the property for income tax arrears, or child support or any other type of legal judgement.
As you can see, a title search helps give you the complete picture/history of the house, so you’re not caught off-guard and your home ownership is not negatively impacted. There’s a lot involved in buying a home and knowing what steps need to be taken will ultimately protect you and your future investment. Make sure you work with experienced, knowledgeable professionals when buying or selling your home, condo or cottage. At Ares Law, we specialize in real estate law in Bracebridge and the larger Muskoka region. We want to ensure your real estate purchase runs smoothly. If you’re looking to purchase in this area, call us today at (705) 645-8743 and find out how we can help.
