Before a short sale: questions for your title report

Look beyond the first mortgage statement

When you are considering a short sale, it is tempting to compare a possible sale price with one loan balance and stop there. A preliminary title report gives you a different conversation to have: what recorded matters and title requirements need attention before the proposed transaction can close?

California DRE describes the title search as identifying ownership history and liens or encumbrances. California’s Department of Insurance explains that title companies examine records such as deeds, mortgages, judgments and tax records before issuing a policy. Ask your agent and title or escrow professional when a current report can be reviewed for your transaction.

What the report does and does not mean

A preliminary report is not the title insurance policy itself. DRE’s 2026 compilation of California Insurance Code sections 12340.11 and 12414.30 explains that it describes terms for a proposed policy, subject to exceptions, and may not list every lien, defect or encumbrance. Treat it as a starting point for professional questions, not a guarantee that everything affecting the property has been resolved.

Five useful questions to ask early

1. Is this the correct property and ownership information? Ask the title professional to explain the property description and names shown. Flag a name change, inheritance, trust, divorce or ownership discrepancy rather than guessing which signature or document will solve it.
2. Which items require action for this sale? Ask for an item-by-item explanation of the report’s requirements and exceptions. Do not assume every listed item is a bill, or that every item can simply be removed.
3. Who will obtain the necessary written information? For an item needing attention, identify the responsible contact and what evidence the title or escrow professional needs. Ask who will request current payoff information, release documentation or other instructions, as applicable.
4. What does the proposed closing plan still leave unresolved? Ask the agent, title and escrow contacts to compare their outstanding-item lists. Keep lender approval questions separate from title requirements instead of assuming one person’s approval covers the entire transaction.
5. Does the report or review need updating? Ask which version your team is using and what must be checked again before closing. Keep the date and report reference in your private notes.

If an item surprises you

Point to the specific numbered entry and ask for an explanation and the underlying recorded document, when available. Describe what you believe is incorrect and why, without deciding for yourself that the entry is invalid. Ask what evidence is needed to investigate it and who will confirm the result in writing.

For example, if you believe an old loan was paid, ask what documentation the title professional needs to review that item. Do not treat your recollection or an old payment receipt as a closing clearance. If ownership, validity, priority or liability is disputed, obtain qualified California legal advice.

Make an issue list, not a do-it-yourself title opinion

For each unresolved item, privately record the report date and item number, your question, the assigned contact, the requested evidence and the next follow-up. Use “awaiting explanation,” “documents requested” and “written response received” rather than labeling an item “cleared” before your professional confirms what that means.

This is an organization method. It does not rank liens, calculate a payoff, decide whether a creditor must accept less, or establish that the sale can close. Ask for explanations before signing documents or agreeing to a resolution you do not understand.

Bring the right questions to the right professional

Use our transaction role map to clarify who is handling each task. Take remaining-debt and tax questions to the appropriate advisers; the California considerations guide separates those topics.

If you have a legal notice or scheduled sale, seek qualified legal help promptly rather than waiting for a routine title follow-up. This checklist does not determine deadlines or promise that foreclosure activity will pause.

Prepared and primary sources checked November 2, 2026. General educational information. Keep reports and supporting documents in your own secure records. Do not upload them through this website.

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