Common Title Problems that Can Impact Your Home Closing

In almost all real estate transactions, there are title issues that must be cleared up in order to transfer ownership of the home from the seller to the buyer.

Does the seller have the legal right to sell the property? Is the home’s title free of “clouds” or “defects” — such as judgments, liens or bankruptcies — that would prevent the seller from transferring “clear” or “marketable” title to the buyer? How can you be sure?

Title companies say that in more than one-third of all real estate transactions they must undertake “extraordinary work” to address title issues and ensure the deal makes it to settlement OK.

Title companies will often scour public records back 50 years or more to look for past deeds, wills, divorce decrees, bankruptcy filings, court judgments, trusts, and tax records that could be defective or outstanding.

From that search, unresolved title issues can surface. And, any unresolved title issue – even if relatively minor – could jeopardize settlement. Here are some common issues title companies say pop up:

Mechanic liens: These are liens are common and are placed against a property that a general contractor or someone who worked to improve the home filed before beginning the work. This is to ensure the contractor gets paid, and the lien is to be released when the job is complete. The procedure for how mechanic liens are filed and processed vary widely from state to state. But problems can surface with these liens when the contractor doesn’t file a “satisfaction” of the lien and, thereby, the lien remains on the property title. Some mechanic liens will expire after a certain amount of time. Regardless, if a mechanic lien is still present when trying to go to settlement, the process can be time-consuming and could prompt a delay in closing.  (Check out state guidelines for filing and processing a mechanic’s lien at www.fullertonlaw.com.)

Bankruptcies: This can be cause a problem, for example, when a seller buys a home while single but then marries someone with a recent bankruptcy. The title company must ensure the new spouse has signed off on the deed and also that the bankruptcy case has been discharged. If not, the title company would need to petition the court to release the property from the bankruptcy process.

Divorces: This often causes problems when a divorced spouse doesn’t remember to remove a lien for child support, even though the debt may have been resolved long ago.  Also, lien issues may arise from past-due spousal support or delinquent taxes.

View a list of more than 70 possible title problems.

If you, or someone you know is considering Buying or Selling a Home in Columbus, Ohio please contact The Opland Group. We offer professional real estate advice and look forward to helping you achieve your real estate goals!

The Opland Group Specializes in Real Estate Sales, Luxury Home Sales, Short Sales in; Bexley 43209 Columbus 43201 43206 43214 43215 Delaware 43015 Dublin 43016 43017 Gahanna 43219 43230 Grandview Heights 43212 Hilliard 43026 Lewis Center 43035 New Albany 43054 Pickerington Powell 43065 Upper Arlington 43220 43221 Westerville 43081 43082 Worthington 43235