While condo ownership can be different in many ways from owning a single-family home, there are similarities in the buying process, including the need for title insurance protection for the buyer and lender.

Once the purchase offer is accepted and escrow is opened, a trained title company examiner will review public records and prepare a preliminary title report designed to alert all parties to the sale of any potential title issues.

Searching public real estate records provides much more information than who is rightfully the current owner. The search can also disclose whether there are any encumbrances against the property, such as a mortgage or deed of trust, liens for unpaid taxes and judgments, unpaid condo association fees, or pending lawsuits involving the property. Any of these issues can and will affect the property's value or desirability and should be cleared before closing takes place.

At closing, the title company issues a title insurance policy that protects the buyer and lender from claims against ownership that pre-date the purchase.

For a condo, however, certain important documents are not always included in the public records and may not be found during a title search. These sometimes include the condo community’s Declaration of Covenants, Conditions and Restrictions (CC&Rs), which set the basic rules and regulations for all condo owners.

The CC&Rs, developed and upheld by the board of directors of the community’s Homeowner’s Association, set certain restrictions on condo owners, including the right to rent out their units, the number and type of pets allowed and how the common areas may be used.

While these disclosures fall outside the province of the title company, the condo seller should provide a copy of the CC&Rs to the buyer well before the closing date, so that the buyer can determine whether the restrictions are acceptable.

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This material is meant for general illustration and/or informational purposes only. Although the information has been gathered from sources believed to be reliable, no representation is made as to its accuracy. This material is not intended to be construed as legal, tax or investment advice. You are encouraged to consult your legal, tax or investment professional for specific advice. 

About Bobbi Pronin

Barbara Pronin is an award-winning writer based in Orange County, Calif. A former news editor with more than 30 years of experience in journalism and corporate communications, she has specialized in real estate topics for over a decade. 

Bobbi is not an employee of Anywhere Integrated Services or affiliated with its title companies.