How to Read Your Preliminary Title Report

The preliminary title report, or "prelim," is one of the first documents you'll receive after opening escrow. It's the result of the title company's initial search of public records related to the property. It's not a title insurance policy, but rather a statement of the terms and conditions under which a policy would be issued.

The report is typically divided into sections. Schedule A details the basics: the property's legal description, the current owner of record, and the sales price. Schedule B is the most important part to review; it lists all the exceptions to title coverage. These are the items the title policy will *not* cover, such as property taxes, existing easements, and any discovered liens or encumbrances. It is crucial for you and your agent to review Schedule B carefully and address any unexpected items with the seller before closing.