In real estate, a clear title can be the difference between finding the perfect home and facing legal issues. For attorneys, protecting clients’ interests during transactions is a must. Every property transfer comes with risks, like hidden liens or boundary disputes. So, there is a dire need to do thorough research. Let’s look at the key steps to protect your clients in every real estate deal.
Clear Title & Its Importance in the Real Estate
A clear title means that a property is free from any debts, legal claims, or disputes that could challenge the owner’s rights. This ensures the owner has full legal ownership, making it easier to transfer the property without any problems.
A clear title is important in real estate deals because it guarantees that the seller legally owns the property and there are no issues that could affect ownership. For example, if a homeowner sells their house with a clear title, the buyer can be sure there are no unpaid taxes or liens on the property. On the other hand, buying a property without a clear title could lead to unexpected problems, where the buyer might have to deal with these issues.
Core Principles for Achieving Clear Title
Ensuring a clear title is crucial in real estate deals to protect your clients and make property transfers smooth. The following are important steps to consider:
- Do a Thorough Title Search
Before finalizing a deal, do a complete title search to check for any existing claims or liens on the property. This helps find any issues that could affect ownership.
- Check Ownership History
Make sure the title documents correctly show the property’s ownership history, with no missing information or mistakes. This includes confirming that all previous transactions were recorded properly.
- Resolve Liens and Legal Claims
Identify and fix any outstanding liens or legal claims before moving forward with the deal. This may involve negotiating with creditors or paying off debts to clear the title.
- Get Title Insurance
Encourage clients to buy title insurance to protect them from any unexpected issues that may come up after the purchase, like hidden liens or legal claims.
- Work with an Experienced Lawyer
Involve a skilled attorney to help navigate any legal issues related to the title and ensure the deal complies with local laws.
- Keep Clients Informed
Maintain clear communication with clients throughout the process, explaining any risks of unclear titles and how to address them.
Common Title Issues Impacting Real Estate Transactions
Common title issues can create major problems in real estate deals and may result in legal disputes or financial losses if not handled properly. The following are some of the most common title problems:
- Liens
Liens are legal claims on a property due to unpaid debts, like mortgages, property taxes, or contractor fees. For example, if the seller hasn’t paid off their mortgage, it creates a lien on the property. Buyers might be held responsible for these debts unless they’re cleared before the sale.
- Public Record Mistakes
Errors in public records, like misspelled names or wrong property descriptions, can cause confusion about ownership. For example, if a previous owner’s name is wrong on the deed, it can delay the transfer of ownership.
- Boundary Disputes
Disagreements about property lines can lead to boundary disputes, often caused by outdated surveys or conflicting information in property deeds. These disputes may need to be settled in court to clarify ownership.
- Missing Heirs
When a property owner dies without a will, it’s important to find and confirm all legal heirs before transferring the title. If any heirs are missing or not identified, it can make the sale more complicated and lead to future claims on the property.
- Defective Deeds
Mistakes in the deed, like missing signatures, wrong names, or incorrect descriptions, can make the title defective. For example, if the seller’s name on the documents doesn’t match the name on the deed, it can delay or cancel the sale.
- Forgery and Fraud
Title fraud happens when someone forges signatures or lies about ownership during a property transfer. This is common with vacant properties or when the owner has passed away, leading to disputes over who really owns the property
- Easement Issues
Easements give others the right to use part of your property for specific reasons, like utility access. Confusion or disputes about easement rights can lead to conflicts between property owners over how the land is used and who can access it.
Final Verdict
In a nutshell, the risks are significant in the world of real estate, and the potential issues are many. A clear title is your protection against legal troubles, and hiring an experienced attorney is the best way to ensure success.
If you need legal help, the team at Jonathan Lee Borsuk PC can assist you. We’ll carefully review your case and offer personalized solutions. If you need help with locking down your title with critical aspects to protect client’s interest, call us at (424) 293-8100.
Please note that this blog is for general informational purposes only and does not constitute the rendering of any legal advice. Please do not rely upon anything in this blog in your dealings, transactions, or businesses. No attorney-client relationship is created or offered by this blog. Thank you. We wish you a pleasant week and a victorious year.
