Covenant Title

The Article

Abstracts of title are written histories of the recorded documents and proceedings of a property. When a property is sold, a title company or attorney will go through property records and prepare a written history. Abstracts Of Title are generally prepared for oil companies. If you are purchasing a home and obtaining title insurance, it is usually unnecessary for you to purchase an abstract. There are several important differences between abstracts of title and title insurance. If you are unsure which you need, continue reading to learn more about these important documents in real estate.

What does an abstract of title include?

The person, or company, purchasing a property should know about any liens or title issues. Any unknown claims, like an ex-spouse claiming partial ownership, could cause future problems. The abstract will show everything noted in property records about the property being sold.

The abstract of title is a thick stack of paper. The document includes liens, like mechanic or mortgage, and tax liens. If taxes are in arrears, these liens take precedence over other liens. You can lose a property if the liens are not paid. You may also find homeowner association (HOA) liens. If the owner did not pay their HOA dues, there may be a lien against the property.

The difference between title insurance and an abstract of title

Purchasing an abstract of title is not the same as purchasing title insurance. Reviewing an abstract of title provides a lot of important legal information regarding the property – but it does not protect you after the purchase. On the other hand, title insurance is used to protect the purchaser against title issues. Some states require an abstract of title as a starting point when purchasing title insurance. If you are purchasing or refinancing a home in Oklahoma, you are required to purchase an abstract. This step is not a requirement in Texas.

It’s important to understand that title insurance protects the purchaser against loss from issues that have already occurred, such as a forgery in the deed. If you have questions about title insurance or whether or not you need to obtain an abstract of title, contact Covenant Title Company, a subsidiary of FirstBank Southwest. As an independent insurance agent, we have underwriter relationships with Alliant National Title Insurance Company and National Investors Title Insurance Company. We also offer closing services. If you have questions about the closing process, call Julie Lamm at (806) 354 -5283 or Contact Us by email.

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