Every building or property has its history, and title insurance protects you from liability if legal issues arise after you join that history. Title insurance companies investigate a property’s history to ensure that the seller has the right to sell a piece of property and that the seller can resolve any restrictions, easements and other issues that might prevent the title from being transferred. If this investigation uncovers issues you will need to resolve them before you can be insured or the sale can go through.
What issues could put your sale in jeopardy?
1. Incorrect boundaries
In some cases, the title does not match the boundaries of the property found by surveys. This can raise questions about whether the seller has the right to sell the property listed on the title. As The Nest notes, it is possible to correct these title issues in some cases. You may be able to purchase the land necessary to make the property match the area listed on the title, for example.
2. Unknown liens
While we may want to believe that everyone is a responsible owner, past owners’ unpaid debts can cause you concerns. Even though the debt belongs to the former owner, a lien on the property can impact your finances after the sale.
3. Undiscovered wills or unknown heirs
If a property’s sale occurred after a past owner’s death, undiscovered wills or heirs could cause problems for new owners. Beneficiaries who did not benefit from the original sale could claim ownership of the property if these you and the seller cannot resolve these issues.
4. Filing errors, typos and other discrepancies
Even a simple mistake can create difficulties in a real estate sale. If titles contain typos or were misfiled, those titles could be rendered invalid.
Because real estate sales involve many different legal details, it can help to work with an attorney who has experience in real estate transactions. They can help you resolve title errors where possible and help you move smoothly through the sale process.