Most Common Title Problems in Real Estate

Watermark Vanquishes Common Real Estate Problems
Published On: January 28, 2022

Watermark Vanquishes Common Real Estate Problems.

You’ve found your dream home, made an offer, and the owners have accepted! Closing on your new house is on the horizon…you just need to make it through the home appraisal, home inspection, and the title search. At this point in the purchase process, are you aware of what speed bumps may arise?
Even if the appraisal and home inspection go smoothly, some buyers find challenges during the title search. While title issues do not occur with every real estate transaction, they do pop up more often than you’d think.

What exactly is a title search? During a title search, a title company digs into the history of a property to trace the trail of ownership. The title company tries to unearth any possible issues that may arise during the sale of a home by looking at the past transactions on the property.

They will examine past documentation and public records such as county, state and federal taxes, financial statements, divorce decrees, and bankruptcy filings, to name a few. If no issues pop up, the title is deemed to be “clean” of any defects.

Sometimes, though, issues do arise. What are the most common problems during a title search? And how can a title company help buyers and sellers remedy these problems before settlement? Let’s take a look at what we’ve uncovered during title searches at Watermark Land Transfer.

Common title defects include:

  • Unknown liens: Previous owners of your home may have delinquent taxes, may have missed mortgage payments, or simply failed to pay a home contractor for renovation work. Although you didn’t run up the debt yourself, when you buy a house, you also are acquiring the debt of the previous owners. The bank can put a lien on the property, even after closing, and unpaid contractors can put a statutory lien, or a builder’s lien, on the property.
  • Surprise heirs: It may seem like a scene right out of a movie, but some owners are surprised by a knock on the door from a long-lost family member of the previous owner who says they have the rights to the property! This title defect can happen when the previous owner is deceased, and a will is uncovered after the sale of the property. Or perhaps the prior deceased owner did not leave a will, and in the subsequent administration of that estate, an heir was missed who should have signed off on the property.
  • Fraud: You purchased your home from a very nice husband and wife who were anxious to close quickly. Unfortunately, you find out later that the very nice wife was actually the deceitful husband’s girlfriend who successfully impersonated the wife at closing so that the two of them could skip town together with the proceeds from closing…and now the real wife is suing to get her property back.
  • Disputed property boundaries: Are those trees in the backyard really yours? Or your neighbors? Sometimes there are property boundary disputes that can result in shared ownership or problems affecting your status as the owner. Wouldn’t it be absolutely awful to discover that your garage is actually sitting on two feet of your neighbor’s property?
  • Clerical Errors: Accidents happen, even with titles. Clerical errors such as filing errors, negligence, and incomplete documentation can cause challenges for new owners. Perhaps a satisfaction for an old mortgage was misfiled…it might look like that old mortgage was never paid off, even when it really was.
  • Unknown easement: While an unknown easement may not be a financial burden, it can cause a headache for a new homeowner. The previous owner may have agreed to not build or add anything to a section of the property for various reasons, and this can prohibit you from using the property as you planned. How will you cope if you discover that your neighbors have the right to use part of your freshly paved driveway to get to their properties? Or that you can’t put in a pool because there is a deed restriction against it?

When any of these issues arise on a title, it is deemed as a defective title. A defective title means the title agent uncovered something that determines the person trying to sell the personal property is either not the outright owner of it or has failed to comply with an order on the property, such as a lien.

Once a title defect is discovered, your title agent will work to “clean” the title with all parties to make sure the property is legally able to be sold to you. In addition, the title company will offer owner’s title insurance to protect your investment. This insurance, although optional, is highly recommended in case of unknown title defects that may come to light after the sale of the home.

Let Watermark Conquer Common Title Defects for You.

Watermark Land Transfer is a full-service title search and title insurance company serving the central Pennsylvania and northern Maryland regions. Our team of title agents has performed thousands of title searches on properties of all types including residential and commercial properties, rental units, distressed properties, farms, and estates. We work diligently to uncover title defects and clean a title before closing. We will explain to you what is happening every step of the title clearance process. We also work with both lenders and buyers on comprehensive title insurance policies to protect their investments.

If you are getting ready to settle on your new home, you have a choice to select your title company. Reach out to us today for a personal approach to title searches and insurance.

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The Benefits Of Choosing Watermark

Watermark Land Transfer is a real estate title company in York, PA offering title services, title insurance, closing and settlement services, and notary services. Our goal is simple - to provide our clients and our community with the resources they need for a hassle-free closing. We are more than a title company and work hard to show our clients that we are truly consumer-focused.

Our team of title agents makes it easy for homeowners to buy or sell a home in Central Pennsylvania and Northern Maryland. We offer both on-site and virtual title and settlement services and treat our clients like family. If you are in the process of selling or buying a home, reach out to us today to see how working with Watermark Land Transfer can help.

1st Watermark Benefits

We Are Vested in You

When you work with Watermark Land Transfer for your real estate transaction, we are truly vested in your success. We treat each contract, document, and closing as if it were our own.

2nd Watermark Benefits

We Keep You In the Loop

During the closing process, we will keep you informed every step of the way so there are no surprises on settlement day.

3rd Watermark Benefits

We Live Here, Too

Watermark Land Transfer is an independent, locally owned title company. We have the flexibility to get things done for you without the constraints of a national title company.