How do I identify red flags on my preliminary report?

So you’ve found the perfect property and you’re in the process of buying it. How do you decipher whether or not there are red flags in the preliminary report? Chicago Title has a few suggestions as to how to do just that. Here are a few.

Taxes are supposed to show the status of the current tax year. Here’s your red flag: postponed property taxes. In order to pay these off, a demand will be needed to be ordered by the state by escrow – and that may take up to two weeks.

Community covenants and restrictions, or CC&Rs, are standard. Here’s your red flag: some CC&Rs prevent certain types of improvements. If you’re going to keep the house for two weeks, that may not be an issue. But if you’re like most people and actually plan to live in the house for some time to come, chances are you’ll want to make improvements on your property.

Easements are also pretty standard. Here’s your red flag: if improvements such as a pool or spa are contemplated, buyers should request that the easement be plotted on a map in order to make sure that there will be no interference with these improvements. Keep in mind, though, that it’s very difficult to get easements removed, so you might be better off with another property if these easements interfere with your future plans.

Agreements typically take the form of mutual easement agreements (such as a shared driveway) or road maintenance agreements. A copy of these should be requested from the title company and provided to you as the buyer. Here’s your red flag: you do not receive this.

Questions? Get in touch!

Dreaming of San Francisco? Cece Blase offers local advice to San Francisco buyers, sellers and owners– and feeds the dreams of those who wish they could live in Tony Bennett’s ‘City by the Bay.’ Call 415-577-0809 or email

Skip to content