The preliminary title report tells you what you are buying as distinct from what you are looking at. Skip the summary and read the exceptions schedule — easements, covenants, encroachments, liens and severed mineral or water rights. Request every referenced document rather than relying on its one-line description.
It arrives in a stack of documents and the summary suggests everything is fine. It is also the document that tells you what you are buying, as distinct from what you are looking at.
Buyers rarely read the preliminary title report properly. It arrives in a stack of documents during a busy period, it is written in language nobody enjoys, and the summary at the front appears to say everything is fine.
It is also the document that tells you what you are actually buying, as distinct from what you are looking at.
A statement from the title company of what the public record shows about the property: who owns it, what is recorded against it, and what conditions any title insurance policy would exclude.
That last part is the useful bit. The exceptions are the list of things the insurer will not protect you from, which is a fairly direct way of saying: these are the risks that are real.
A right someone else has to use part of your land.
Utility easements are routine and usually harmless. Access easements matter more — a neighbor with a recorded right to cross your property to reach theirs is not something you can withdraw because you would prefer privacy.
What to establish: where exactly it runs, who holds it, whether it is exclusive, and whether it constrains where you could build. An easement crossing the only viable site for a pool or a guest house changes the property's potential substantially.
Recorded rules governing what can be done with the property, which run with the land and bind you regardless of who agreed to them.
These commonly cover height, setbacks, materials, colors, fencing, outbuildings, tree removal, short-term rental and sometimes architectural approval by a committee. In established communities they can be considerably more restrictive than local zoning.
If a plan is part of your reason for buying, confirm it against the covenants before you commit rather than after.
Something physical crossing a boundary. A wall built two feet onto the neighbor's land, a driveway that clips a corner, a hedge planted where nobody checked, a neighbor's structure over your line.
These are frequently decades old and entirely amicable until ownership changes. Then they become a dispute between two people who did not create the problem, and the cost of resolving them bears no relationship to the value of the land involved.
A survey is the only way to find them. On any property with acreage, walls, outbuildings or mature planting near a line, commission one.
Recorded claims against the property. Mortgages are expected. Others are not: contractor liens from unpaid work, tax liens, judgment liens, or assessments for public improvements.
Most are cleared at closing, and the process handles them routinely. What matters is knowing they exist early enough that the timeline accounts for it, because some take longer to release than a contract allows.
Frequently severed from surface ownership, particularly on acreage and in certain states. Someone else may hold the right to extract beneath your land, and in some circumstances to access the surface to do it.
Water rights are their own discipline on rural property, and are commonly the most valuable thing being conveyed. They are also the thing most often assumed rather than verified.
Skip the summary and go to the exceptions schedule. Ask the title company for a copy of every recorded document referenced rather than relying on the one-line description — the description is not the instrument, and the difference occasionally matters a great deal.
Have your attorney read anything you do not fully understand. Plot the easements onto a survey so you can see them rather than imagine them.
And ask the obvious question about anything unfamiliar: what does this prevent me from doing?
The report usually arrives early in escrow and is one of the few diligence items available immediately. Read it in the first days, not the last, because the questions it raises take time to answer and some of them change whether you want to proceed.
The exceptions schedule. It lists what the insurer will not protect you from, which is a fairly direct statement of which risks are real.
Because they are permanent and they constrain what you can build. An access easement crossing the only viable site for a pool or guest house changes the property's potential, and you cannot withdraw it because you would prefer privacy.
On any property with acreage, walls, outbuildings or mature planting near a boundary, yes. Encroachments are usually decades old and amicable until ownership changes, and resolving them costs far more than the land involved is worth.
Recorded rules that run with the land and bind you regardless of who originally agreed to them. In established communities they are often more restrictive than local zoning, covering height, materials, outbuildings and sometimes architectural approval.
In the first days of escrow. It is one of the few diligence items available immediately, and the questions it raises take time to answer — some of them change whether you want to proceed.
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