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

A title search plays a crucial role in real estate transactions as it is primarily conducted to verify the legal ownership of a property and to identify any encumbrances, such as liens, easements, or other claims that may affect the property's title. This process ensures that the seller has the right to sell the property and that the buyer receives clear and marketable title free of unforeseen issues.

Conducting a title search helps to prevent future disputes over ownership and confirms that there are no outstanding debts or obligations tied to the property that could affect the buyer's use or enjoyment of it. This practice is fundamental to establishing the integrity of the title, thereby protecting both the buyer's investment and the seller's interests in the transaction.

In contrast, determining the rent price pertains to rental agreements, appraising market value relates to establishing a price point for sale rather than clarifying ownership, and establishing a marketing strategy focuses on how to sell a property effectively, none of which directly address the ownership verification or identification of encumbrances that a title search specifically entails.