Identify Potential Title Issues
With the real estate market always fluctuating and changing, it’s important to be aware and understand how to identify potential title issues. Title issues can be damaging to both the property and buyer alike, so it’s essential to remain vigilant and take necessary measures to avoid such problems.
In this article, we’ll discuss some common title issues, how you can spot them, and how to protect yourself against their occurrence.
What is a Title Issue?
A title issue is a problem that arises orally or in writing during a home closing process. It generally involves a dispute over the identity of the rightful owner of a property. In some cases, title issues may arise from prior owners who did not fully disclose all of their interests in the property. In some cases title issues may arise from a legal issue regarding the property.
Title issues are not to be taken lightly, as they can significantly delay or even cancel a real estate transaction. Additionally, not knowing how to spot these issues can cost prospective buyers thousands of dollars.
How to Spot Title Issues
It’s important to take proactive measures to identify any potential title issues before making an offer on a property. Additionally, it’s essential to hire a title company that is well-versed in recognizing title flaws.
Below are some common warning signs of title issues:
Inaccurate Information on the Deed
The most reliable way to identify a title issue is by examining the deed. If the seller’s name, purchase date, and/or other important information is filled out incorrectly, it can be a sign of underlying title issues. While it’s still possible to purchase the property with incorrect information on the deed, it could make it more complicated for the buyer.
Outstanding Agreements & Liens
Any outstanding agreements or liens on a property can also be indicative of potential title issues. It’s important to ask the seller questions about any past agreements they may have had on the property, or if they are up-to-date on any loan or line of credit payments. Doing this helps to ensure there are no outstanding issues or liens on the property.
Prior Owners & Foreclosures
Past owners of the property and any foreclosures should also be examined for potential title issues. Enlisting the help of a title company can help quickly uncover any past issues that may have occurred. Additionally, speaking with the seller to ensure all ownership and foreclosure issues have been fully resolved can alleviate any potential problems.
Researching the Title
Another way to ensure there are no potential title issues is to have the title researched prior to submitting an offer. If a title research company is used, it can help uncover any potential issues that may be present.
Hiring a Title Company or Attorney
Many title companies can provide title insurance when researching a title to ensure that should any title issues arise, they will be taken care of. Additionally, hiring an attorney can help provide extra peace of mind when it comes to the title of a property.
Summary
The real estate market is constantly fluctuating, so it’s important to know how to identify potential title issues. Title issues can be damaging to both the property and buyer, so it’s essential to remain vigilant and take necessary steps to avoid such problems. Some common warning signs to look out for include inaccurate information on the deed, outstanding agreements or liens, and researching the title. Additionally, hiring a title company or attorney can provide extra protection in the event of any potential title issues.
