2026-10-30 · 4 min read · Orange County
How Do I Read a Preliminary Title Report Before I Buy?
The short answer
A preliminary title report shows who owns the home, how title is held, and the liens, easements, restrictions and other items the title company plans to list as exceptions in your title policy. Start with the owner's name and the legal description, then read every numbered exception and ask which ones will be paid off at closing and which will stay with the property. Under California law, the report is an offer to insure, not a promise that title is clean, so review it during your contingency period.
What Is a Preliminary Title Report?
How do you read a preliminary title report before you buy a home in Orange County? You read it as a list of what the title company is willing to insure and what it plans to leave out, and you finish reviewing it before your contingency deadline.
I'm Jeanette Nelson, a REALTOR® with Jeanette Nelson Real Estate, Keller Williams Realty, serving Orange County, Huntington Beach, Costa Mesa, Fountain Valley, and surrounding areas. The "prelim" usually arrives early in escrow, and I want buyers to know what to look for instead of filing it away unread.
The title company prepares the report after searching public records for the property. California Insurance Code Section 12340.11 says a preliminary report is not a representation about the condition of title. It's a statement of the terms on which the company is willing to issue a policy. Insurance Code Section 12414.30 requires a bold notice on owner's policy reports saying the same thing.
This article is general information, not legal advice. If something in your report concerns you, please talk with a real estate attorney or the title officer.
What Are the Main Parts of the Report?
Most reports follow a similar order:
- Property and legal description. Check that the address, parcel number and legal description match the home you're buying.
- Vesting. This shows who currently holds title and how. The seller in your contract should match the owner named here, or escrow will need documents showing who has authority to sign, such as for a trust or estate.
- Exceptions. These are the numbered items the policy won't cover unless they're removed before closing.
- Requirements. Items the title company needs before it will close, such as payoff statements or signed documents.
How Do I Read the Exceptions?
The exceptions are the heart of the report. Read each one and sort it into one of two groups.
Items that should be paid off at closing. These include the seller's existing mortgages, recorded liens, and the current year's property taxes. Your escrow officer arranges the payoff, and these should drop off before your policy is issued.
Items that stay with the property. These usually include:
- Easements. Rights for utilities or others to use part of the land, such as a strip along a back fence.
- CC&Rs. Covenants, conditions and restrictions, common in HOA communities and many tracts. They can affect things like additions, fences, parking and paint colors.
- Recorded agreements. For example, a shared driveway or a recorded encroachment agreement.
Ask for copies of the underlying documents for anything you don't understand.
What Should Raise Questions?
These items deserve a closer look before you remove your contingency:
- A name that doesn't match. If the owner on title isn't the seller, ask how they have authority to sell.
- Liens you weren't told about. Judgments, tax liens or contractor liens need a plan for payoff.
- An easement through a spot you care about. If you plan a pool, an addition or an ADU, check that the easement doesn't block it.
- Restrictions that affect your plans. CC&Rs may limit improvements you had in mind.
The California Department of Real Estate (DRE) reference book explains that contracts usually give buyers time to review documents like this. Your contract sets the deadline, so start early.
Do I Still Need Title Insurance if the Report Looks Clean?
Yes, for most buyers. The Consumer Financial Protection Bureau (CFPB) explains that owner's title insurance protects you if someone later claims a right to the property that existed before you bought it, such as a past owner's unpaid taxes or a contractor who says they were never paid. Most lenders require a separate lender's policy, which protects only the lender.
My article on taking title to your first home explains vesting choices, and this article on escrow shows where the title report fits in the timeline.
Let's Start With a Conversation
If you're in escrow and your preliminary title report just arrived, I'd be glad to go through it with you and help you list questions for the title officer. Call or text me at 714.366.8575 | DRE: 01397168, or contact me. Jeanette Nelson is a REALTOR® with Jeanette Nelson Real Estate, Keller Williams Realty, serving Orange County, Huntington Beach, Costa Mesa, Fountain Valley, and surrounding areas.
Frequently asked questions
Who orders the preliminary title report?
The title company prepares it once escrow opens, and it's sent to the buyer, the seller and their agents.
Can the report change before closing?
Yes. The title company can update it if new documents are recorded or new information comes in. Ask for any updated report and review the changes.
What is "vesting"?
Vesting is the way title is held, such as by one person, a married couple or a trust. The report shows the current vesting, and your deed sets yours.
Does a clean report mean there are no problems?
Not necessarily. California law says the report isn't a representation of the condition of title. Owner's title insurance is what protects you after closing.