When investing in real estate, a wide variety of details can have a significant impact on your ownership of that property. One of the most important details is the title, and title defects could lead to future legal battles or even endanger your ownership right to the property. What should prospective real estate buyers know about title defects?
What are some common title defects?
A wide variety of different issues related to a property’s title can impact the transfer of ownership. Some of the issues that may interrupt the transaction include:
- Unpaid debts—When there are unpaid taxes or other debts, creditors may put a lien on the property.
- Document errors—Because of the number of documents that may be filed about the property over time, there are many different clerical errors that could cause concern. Misfiled paperwork, inaccurate descriptions, missing holder names or signatures, inconsistent wording and other errors can all lead to a defective title.
- Forgery and fraud—While some title defects are the result of mistakes, fraudulent documents intentionally misrepresent the state of the property or the people who have ownership rights. In these cases, the person selling the property might not have the legal right to make that sale.
What can real estate buyers do about title defects?
While title defects delay or prevent the sale of a property, buyers can resolve them in many cases. Some minor errors might be fixable by correcting a document. Other, more serious issues may require legal action.
Despite the challenges it can cause, a title defect is not necessarily the end of a real estate transaction. Give us a call so we can help with your real estate title needs.