Different Problems That Title Search Reveal
The title search is one of the most important steps, if not the most important step, in a real estate transaction. A title search is the review of all public records pertaining to a piece of property to ensure that a chain of title is clear and a seller can rightfully sell property, you will want to have the help of an experienced South Carolina real estate attorney when conducting your own title search.
Defects in titles are remarkably common, but issues can also be somewhat troublesome to correct. The property title search is essentially a deep dive into the ownership history of a home that a seller is selling and a buyer is buying which ensures that a person who seemingly owns the property actually has the right to sell it.
Common Problems in Titles Searches
Most property title searches end up turning up nothing that holds up the home sale process. There is a remote chance that a property title search could turn up some kind of issue that delays or possibly even derail the homeownership process.
Some of the most common problems found in property title searches include:
- Errors in public records — Basic mistakes include clerical, filing, or spelling errors that may have negative effects on deeds and a seller’s ability to sell the property. A misspelled name could lead to a lien against a property being entirely missed in a title search. The process of buying and selling any kind of property involves several different parties, so it can be more likely that one or more of the parties have a paperwork error, possibly derailing the entire process. While a mistake could be as simple as a listing or filing error in public records, it could also be something big involving a real estate agency, mortgage broker, or real estate agency.
- Unreleased deeds of trust — An extremely common title problem, an unreleased deed of trust is a deed that is still tied to the property but not yet recorded by the Land Records Department. The good news is that this is a relatively easy matter to resolve.
- Problems with the boundary lines — Simple boundary disputes can turn into major problems when it comes to a property title search. The most common problems with boundary lines include differing surveys showing where exactly the property being sold actually extends to. Both parties will have to know exactly what they are selling and buying, so these kinds of problems may extend to the local or state level, especially when a piece of property could have something inadvertently built on land that does not belong to them.
- Undiscovered liens against the property — Financial institutions may place liens on the newly-acquired property after a sale has closed when the former owners did not pay their debts. If a previous owner did not pay their taxes, their tax burden thus becomes the problem of the new owners when the lien is not resolved before the sale.
- Bankruptcies — When a seller declares bankruptcy, a bankruptcy judge on the property might extend to the new owners. When a buyer is not cautious, they could end up having to pay a judgment levied against the prior bankrupt seller.
- Unknown easements — When an unknown easement shows up after a sale, it could prevent a new owner from using their property as they want. An easement can also give other parties access to the property, and both of these could cause issues over a new owner’s use of the property.
- Forged documents — Several documents are involved in homeownership, and some individuals may forge critical signatures or pieces of paper that are important to the entire ownership process.
- Breaks in the chain of title — The chain of title shows each and every owner of a piece of property, and a problem can arise when any segment of that chain was made illegally. Illegal deeds will affect the enforceability of prior deeds and ownership and can carry to new ownership.
- Incorrect legal descriptions — Every piece of property will have a recorded legal description, and any part of a legal description that is incorrect can disrupt and complicate a sale.
- Missing or fighting heirs — Heirs could be troublesome for property transactions when they are unknown or otherwise difficult to find after a property owner has died. Some heirs may contest a will to stake their claim to the property. Missing heirs could also show up or file lawsuits after a sale, which could jeopardize a new owner’s legal rights to own property.
- Other owners — A property title search may reveal that the property has another listed owner, usually related to some other debts or liens existing on the property. When this happens, a party might be able to make a claim on the property and actually block the sale.
- Undiscovered wills — When no will was apparently left behind after a person dies, property may be sold with an assumption that there was no will. If the previously-deceased owner’s will does come to light long after a new owner purchases the property, then their rights to the property might be in jeopardy.
- Impersonating an owner — Some people may take the name and identity of another owner to attempt to sell a piece of property to a buyer. Such scams are actually common, and when this happens, an entire transaction can be declared void, and the buyer loses their rights to the property.
- Divorce edicts — A marriage that fails could have significant repercussions on the financial stability of a household. In such cases, a seller could have lost part or maybe even all of the property in a divorce settlement, meaning that the other divorced party needs to be involved with the process. When that party is not part of the transaction or does not grant permission for the sale, the entire homeownership process could end.
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Did you need assistance conducting an exhaustive title search in South Carolina? Weeks and Irvine, LLC knows how important this process can be and will work to get you the most thorough and complete picture possible.