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Title searches critical in real estate deals

Title searches are an essential part of purchasing a property, Toronto real estate lawyer Daniel Bernstein tells AdvocateDaily.com.

Bernstein, a lawyer with Weltman Bernstein, says a proper check by the purchaser’s solicitor could uncover a variety of problems that would otherwise hold up the closing.

For example, he says it’s not unusual for a seller’s old, paid-out mortgages to remain on title without their knowledge. In rarer cases, even older mortgages from prior owners can still appear on title.   

“They may not have been discharged through inadvertence,” Bernstein says. “But it’s the responsibility of a purchaser’s solicitor to ensure that all mortgages and lines of credit are discharged, and it is only through a title search that mortgages and lines of credit can be identified.”

He says the searches also help buyers verify information in the agreement of purchase and sale, including the name of the vendor and the precise description of the property. Any discrepancies must be accounted for, Bernstein says.

Title searches can also disclose other vital facts about the property that purchasers need to know before going through with a real estate deal. In cases of mutual driveways or walkways between homes, Bernstein says a search will reveal the specific rights of access granted to adjoining property owners.

Rights of ways or easements may also be granted in favour of utility companies to allow them to make repairs, trim trees or dig up ground, he says.

“I’ve seen a case where title to a property was subject to a right of way to access an underground oil pipeline,” Bernstein adds.

Sometimes, restrictions on the property are registered on title that bind future owners.  

“These could include rules relating to the size and dimensions of a home, fences on the property, grading of lands, and the finishing of home basements,” Bernstein says.

On occasion, he says abutting land searches are needed to ensure compliance with Ontario’s Planning Act to confirm property owners do not own abutting properties.

Depending on how the terms of the agreement are written, Bernstein says buyers may also have to accept what's uncovered by a title search. However, he says purchasers’ solicitors should ensure their clients’ title is not subject to any registered instruments that they are not contractually obliged to accept.

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