During a real estate transfer, it is important to ensure that there are no serious issues with the title. These are often referred to as title defects. Performing a search in advance can help expose them and allow you to take steps to rectify them.
But the first step is to understand what types of issues you should look out for. Here are three examples.
Liens on the property
In some cases, if money is owed, there could be a lien on the property. For instance, a contractor who performed work but was never paid may have a mechanic’s lien. Often, the lien must be paid before the property can be sold, so this issue needs to be addressed in advance.
Other ownership claims
Next, there could be ownership claims from other individuals. This is sometimes connected to estate administration and the probate process. It may not be clear exactly who owns the property or who has the right to sell it. There can be issues if multiple people have an ownership claim, such as when two beneficiaries inherit the property together and only one of them is attempting to sell it.
Existing easements
Finally, some properties have easements that give others access. A neighbor may have the right to use a shared driveway, for instance, or there could be easements for utility companies. Depending on how the easement was structured, it may or may not continue after the property is sold. It is important for anyone purchasing property to know what obligations they may have.
The legal process
This shows some of the complexities that you may encounter during a real estate transfer. It is important to know what steps to take during this process, and it can be helpful to work with an experienced law firm.