A preliminary examination of real estate records reveals any existing claims, encumbrances, or charges against a specific property. This process might uncover unpaid taxes, mortgages, judgments, or other financial obligations attached to the real estate. For example, a contractor who completes renovations but remains unpaid may file a claim against the property to secure payment.
Discovering potential liabilities before a transaction safeguards buyers and lenders from inheriting unforeseen debt and legal entanglements. This due diligence provides transparency, enabling informed decisions and mitigating financial risks. Historically, these investigations have evolved alongside property ownership records, providing increasing certainty and security in real estate dealings. A clear title, free from encumbrances, has become a cornerstone of secure property transfer and financing.