That's because a title search does not reveal two essential pieces of information: whether there are unpaid taxes and other liens (beyond those defined below) against a property. Nor will it identify leases of less than three years, which can involve such nasty surprises as a furnace rental that would mean the furnace would be picked up shortly after you take over the property.
"The law is complicated and not really a do-it-yourself-thing," says Brian Bigras, general manager of the British Columbia Land Title Office in New Westminster. "It's more common to see people discharge their own mortgages. Even people who buy and sell homes without an agent usually hire a lawyer. Their fees are very competitive -- around $500 for a fund transfer -- and the title search is included in this."
Of the one million land title transactions Bigras and his staff of 120 process each year (they work on 17,000 at any given time), only a handful are initiated by private citizens.
What a title search will reveal
You need a title search in any of the following four situations: when you're buying or selling property, refinancing, taking out a secured loan against your home or applying for a building permit.
A title search reveals:
Luckily for Canada, we're on the Torrens System of title searches, developed in Australia in 1858 by Sir Robert Torrens. This means that despite some subtle differences between each province and territory, the federal government guarantees the certainty of information on both property ownership and "encumbrances against the land," as outlined above. This eliminates the costly court battles and title disputes often seen in the U.S.
The Torrens System -- widely considered the most advanced and safest in the world -- is why Canadian searches involve only a nominal fee, and land transfers are relatively simple.
"Conveyance lawyers are all online with the land title office," says Joe Wilder, managing partner at Wilder, Wilder and Langtry, a full-service law firm in Winnipeg. Thanks to the Torrens System, he says, "it doesn't take long to complete a search, and it is part of the legal work involved when you buy a house. We charge about $10."
Roger Howay, partner at Blake, Cassels & Graydon LLP in Vancouver, adds, "With the computerization of some of the land title systems in Canada in recent years, it is very easy for lawyers, real estate agents and others who deal in title-to-land to obtain searches of property very quickly and efficiently."
So, whether you're one of the few who opt to do it yourself, or you just want to sound intelligent when vetting what your legal and real estate advisers are up to, now you know what a title search is and how it can help rattle the bones of whatever skeletons may be lurking in the closet.
Pam Withers is a business journalist, business-book editor and author of several best-selling teen novels. Julie Burtinshaw is a researcher and novelist.
|-- Posted: July 14, 2004