Abstract of Title

• Author: Jeffrey Lehman, Shirelle Phelps

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A condensed history, taken from public records or documents, of the ownership of a piece of land.

An abstract of title, or title abstract, briefly summarizes the various activities affecting ownership of a parcel of land. When a person or business agrees to purchase real estate, that person or business arranges for an examination of

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the history of the property's title. This examination is known as a title search. A title search is conducted to determine that the seller of the property in fact owns the property and has a free-and-clear title. A free-and-clear title has no clouds on it, which means that no person or business other than the seller has an interest in, or claim to, the property.

The process of determining the precise ownership of a piece of land by searching an abstract is complex and laborious. Often, the title abstract does not contain every transaction or proceeding that may affect ownership of the land. The search conductor, or abstractor, usually a trained professional, must verify that the abstract is complete by reviewing recent certifications that the abstract is correct, checking for gaps in dates and certification numbers, and ensuring that a proper legal description appears with each entry. The abstractor conducts a credit and finances check on all the names appearing in the abstract to see if any of the parties has filed for BANKRUPTCY or has incurred other debts that may have caused a creditor to file a lien against the property toward payment of the debt.

An abstractor must refer to many different sources to verify that the title to a parcel of land is true and correct. The abstractor verifies the original government survey, which should include gaps and overlaps in land ownership. Given improved technology, surveys have a margin of error of less than one foot. The abstractor must understand the various means of describing the exact boundaries of a piece of land and must recognize unacceptable methods.

Claims on the title to a property are subject to time limitations, but the limitations have certain exceptions. For example, the Forty-Year Law holds that no party with a potential claim that arose over 40 years before can claim an interest in a property of which one person or business has been the recorded owner for at least 40 years. Exceptions are made, however, for those holding mortgages or contracts with terms that span more than 40 years and also for prior interests claimed as school or school district lands, parkland dedications, or the property of religious corporations or associations.

To perform a title search, the abstractor must obtain a copy of the abstract from the county recorder in the county in which the land is located. Then it takes time to make sense of the document. The accompanying sample abstract of title illustrates typical entries.

Entry 1 identifies the land in question. The sample...