In the context of real estate, the term "abstract" refers to an important legal document that provides a comprehensive history of the ownership and encumbrances on a particular property. It is also known as an "abstract of title" or simply "title abstract." The abstract is typically prepared by a professional called an abstractor or title examiner.
The abstract contains a detailed summary of all recorded documents and transactions related to the property, including deeds, mortgages, liens, easements, and other relevant instruments. It aims to establish a clear chain of ownership and identify any potential issues or claims that may affect the property's title.
When conducting a real estate transaction, such as buying or selling a property, the abstract is often reviewed by attorneys, lenders, or title companies to ensure that the title is free from any defects or encumbrances. This process is known as a title search. The abstract plays a crucial role in determining the property's marketability and provides important information to both buyers and sellers.
It's important to note that the abstract itself does not guarantee the validity or marketable title of the property. Instead, it serves as a historical record and starting point for further examination and due diligence. In some cases, title insurance may be obtained to protect against any unforeseen issues or claims that may arise even after a thorough review of the abstract.