ALTA Practice Exam – Complete Prep Resource

Reviewing the title report for any discrepancies is crucial for buyers prior to closing on a property because it ensures that the title is clear of any encumbrances or legal issues that could affect ownership. The title report provides key information about the property, including existing liens, easements, and any claims that could potentially dispute the buyer's ownership rights.

Addressing discrepancies found in the title report can prevent future legal complications, protect the buyer's investment, and provide peace of mind that they are acquiring a property free of unexpected liabilities. This step is fundamental to the due diligence process, allowing buyers to fully understand what they are purchasing and safeguarding their ownership after the transaction is completed. If discrepancies are present, they need to be resolved before proceeding to closing, as these issues could jeopardize the buyer's title rights.

While securing financing options, understanding insurance terms, and negotiating closing costs are all important considerations, they do not directly address the fundamental issue of title integrity. Without a clear and marketable title, none of those other factors hold value, as the buyer could end up facing title-related disputes or financial losses in the future.