You’ve found your dream home, made an offer and the bid was accepted – but you need to get through closing. That means that a title search has to be done before the deal closes and you take possession.
Over the years, as a piece of property changes hands, the title can end up with defects in it that could negatively affect your ownership rights. Title searches are done so that your interests (and the bank’s interests, if you want a mortgage loan) are protected. Here are some of the most common problems you may encounter:
Unknown or unlocated heirs
If you’re buying the property in an estate sale, problems can crop up if there are questions about the deceased’s will or family members with the right to inherit that have not been located. They have the potential to someday come forward and challenge your ownership rights unless further action is taken.
Liens by creditors over debts
When a property owner has unpaid debts, including property or income taxes, the creditor may put a lien on the home. This gives the creditor a stake in the sale and cannot be removed until the debt is paid. Sometimes these liens are inaccurate or misapplied, and sometimes they were paid but never properly removed.
Unexpected easements
An easement is a type of property interest that grants the holder the right to use another party’s land in some fashion. For example, your neighbor may have the right to use your access road to the public highway nearby. That’s fine, as long as you understand that the easement is there and it doesn’t bother you. The problem crops up when there’s an easement you aren’t expecting.
When ugly surprises crop up before closing, don’t get overly distressed until you find out what it will take to resolve the issue so that the sale can go forward. Some title issues can be quickly fixed, while others take a little negotiation. Whatever the situation, make sure that you have experienced legal guidance throughout the process.
