Common Title Problems in Real Estate
Posted on September 17, 2019 by Laura Lucky
Have you ever wondered why you need title insurance? Your home may be new to you, but every property has a history. A title search can help uncover title defects tied to your property. And, subject to the terms of the policy, your title insurance may provide you with protection from title problems discovered after you close your transaction. Some of these common title issues are:
Unknown liens: Even though the former debt of prior owners is not your own, banks or other financing companies can place liens on your property for unpaid debts even after you have closed on the sale.
Illegal deeds: It’s possible that a prior deed was made by an undocumented immigrant, a minor, a person of unsound mind, or one who is reported single but in actuality is married.
Missing heirs: When a person dies, the ownership of his home may fall to his heirs, or those named within his will. However, those heirs are sometimes missing or unknown at the time of death.
Forgeries: Sometimes forged or fabricated documents that affect property ownership are filed within public records, obscuring the rightful ownership of the property.
Undiscovered encumbrances: At the time of purchase, you may not know that a third party holds a claim to all or part of your property.
Unknown easements: You may own your new home and its surrounding land, but an unknown easement may prohibit you from using it as you’d like, or could allow government agencies, businesses, or other parties to access all or portions of your property.
Boundary/survey disputes: Surveys may exist that show differing boundaries than what you’ve been told. Therefore, a neighbor or other party may be able to claim ownership to a portion of your property.
False impersonation of previous owner: Common and similar names can make it possible to falsely “impersonate” a property owner. If you purchase a home that was once sold by a false owner, you can risk losing your legal claim to the property.
These and other issues are often covered by an owner’s policy of title insurance. When you buy a home, make sure you’re protecting that investment with title insurance.
Source: First American Title
