As a licensed real estate agent representing buyers in a residential real estate transaction, numerous responsibilities fall to you. You have to help them evaluate properties to determine if they meet their needs. They count on you to spot signs of issues with the property during a walk-through and to understand what the fair market value of the property actually is. They also need you to review their documents to make sure that they are fair and appropriate.
Finally, they expect you to help them navigate any issues that might arise during the process. For example, buyers would expect you to know the right response if the property they made an offer on turns out to have title issues. Title issues can delay a closing or make the seller unable to transfer the home.
What kind of title problems could potentially derail your closing?
An undisclosed lien
One of the most common issues that turn up during a title search is a lien against the property. Maybe the homeowner had a new roof installed and didn’t pay off their contractor, resulting in a lien. They may have already paid the amount owed but failed to have the company remove the lien afterward. There could be tax liens or a second mortgage that the seller has to pay off and remove before they can transfer the property to you.
Secondary owners on title
There could be other individuals on the title, including a sibling that the owner occupant inherited the property with or an estranged spouse. These people have an ownership interest in the property and have to take part in the transaction or rescind their interest.
Differences in the legal description
Sometimes the title records contradict claims made by the seller. The legal description for the property recorded by the county might show a much smaller parcel than what the listing includes.
How can you resolve title issues?
Often, title issues simply require some financial adjustment or the execution of a deed. It is possible to resolve even significant title challenges without changing the scheduled closing in any way.
However, sometimes the party with an interest in the property won’t sign a deed or is difficult to locate. Sometimes, they might even be dead already. A quiet title action in civil court may be necessary in some situations to resolve title issues before a transaction occurs.
Understanding why title issues arise and how you can handle them will make you a better form of support for buyers.