One thing that can derail a residential real estate transaction is a title defect. It is very important to look into potential title issues in advance. They can often be resolved upfront to help the process go smoothly.
But what types of title issues should you be concerned about? What would a bad title look like? While every case is unique, below are three examples.
Outstanding liens
For one thing, there could be a mechanic’s lien or a tax lien on the property. This means that there is an outstanding debt. Before that property can be sold and the title can be transferred to another party, the debt needs to be taken care of.
Multiple owners
Things often get complex when there are multiple owners. For instance, perhaps two individuals purchased a property together years ago, but now just one of them is trying to sell. A similar issue is when two people have inherited a property, so they both have ownership rights, and one person may be attempting to sell the property without the approval of the other.
Paperwork errors
Finally, there can be significant paperwork errors. Maybe the title and the deed have inconsistent wording. Perhaps it is not clear who is truly the owner of the property and has the right to sell it. Maybe there are missing signatures on the documentation. Perhaps necessary documents are missing entirely, and they need to be located before a sale can take place.
Have you run into any of these types of title defects during a residential real estate transaction? If so, it can help to work with an experienced attorney to seek a resolution.
