An abstract of title—also known as a title examination, examination of title, title abstract, or title abstraction—is the legal history or chronology of a certain piece of real property. For example, an abstract of title includes a history of all the property’s owners, the period during which each owner held the title to the property, and all liens and encumbrances that affect title to the property.
An abstract of title is usually prepared for a mortgagee (bank or lender) or a purchaser of the property and is sometimes used to market the property to a potential buyer. An abstract of title is generally designed to identify and eliminate any clouds (claims) on the title. In contrast, a title report is merely used to facilitate the purchase of title insurance and is sometimes not as complete or reliable as an abstract of title.
In Washington State, an abstract of title is a document that provides a detailed history of the legal ownership and claims on a specific piece of real estate. It includes a chronological list of all previous owners, the duration of their ownership, and any liens, encumbrances, or legal issues that may affect the property's title. This document is often required by a mortgage lender or potential purchaser to ensure that the title is clear of any defects or 'clouds' that could affect their interests. The preparation of an abstract of title is typically performed by a title company or an attorney with expertise in real estate law. While a title report is also used in real estate transactions, mainly for obtaining title insurance, it may not be as comprehensive as an abstract of title. In Washington, the accuracy and thoroughness of an abstract of title are crucial for the protection of the parties involved in a real estate transaction.