What is the purpose of a title search in a real estate transaction?

The purpose of a title search in a real estate transaction primarily revolves around verifying property ownership and checking for any liens or claims that may be attached to the property. This process involves a thorough examination of public records to establish a clear chain of title, ensuring that the current owner is legally entitled to sell the property.

By conducting a title search, potential buyers and their lenders can identify any existing encumbrances, such as mortgages, easements, or judgments against the property. This is crucial because any unresolved claims could affect the buyer's rights and ownership after the sale. Ensuring there are no outstanding issues allows for a smoother transaction and mitigates the risk of future legal disputes.

In contrast, estimating the value of the property, assessing property taxes, and evaluating potential buyers do not directly relate to the purpose of a title search. While these factors are important in real estate transactions, they fall under different areas of consideration apart from ownership verification and lien-checking, which are the primary objectives of a title search.