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 Nevada, an abstract of title provides a comprehensive history of a specific piece of real estate, detailing past ownership, the duration of each ownership, and any liens or encumbrances affecting the property. This document is crucial for potential buyers or mortgagees (lenders) to understand the legal status of the property's title and to identify any potential issues, known as 'clouds', that could affect their interests. The preparation of an abstract of title is a thorough process aimed at ensuring that the title is clear of any defects before a transaction. While a title report can also be used during the process of purchasing title insurance, it may not be as detailed or exhaustive as an abstract of title. In Nevada, as in other states, title companies or attorneys typically prepare these documents to ensure that the property can be transferred with a clear title.