Millions of documents have been filed against property titles over the last decade. The sheer volume of documents leaves a trail of misfiled documents, filed documents with errors and fraudulent documents. Add to that the tens of thousands of defunct title agents who didn’t file documents and the likelihood of title defects on your property is high. We are all urged to check our life insurance policies and vehicle titles as well as our credit reports and credit scores, but do we ever check the title to our property? We generally don’t do this until we are going to refinance or sell our property. In most cases, these title defects can be straightened out, but with so many banks and title companies no longer in business, tracking down satisfactions or other releases has become difficult and can delay the closing.
Here are some of the title issues that can cause problems and hinder a potential sale or refinance:
Unreleased mortgages – even though you have paid your mortgage off in full, a lien release must be filed at the county to remove the lien from your property title. These releases are sometimes sent directly to the county, sometimes to the title company that paid it off and sometimes directly to the homeowner who has no idea how to get it recorded or even that they need to do it. Attempting to get the release years later is difficult at best and impossible at times.
Liens can be placed on your property by a variety of sources such as contractors, ex-spouses, business partners, attorneys, creditors and government entities such as the Department of Revenue, IRS or County Human Services for child support
Incorrect liens can be filed against your property due to an error in a legal description. Your neighbor’s $300,000.00 mortgage can be filed on your property by the simple mistyping of Lot 1 instead of Lot 2. We have dealt with this situation far more often than you would think.
Family changes such as death or divorce need to be dealt with also. Certified copies of probate documents and divorce decrees need to examined and filed and waiting to do this at closing time can cause delays and may even require amended documents due to incorrect legals or other clerical errors.
These are just some of the common defects that can be discovered by a simple property search. An ownership report can save you invaluable time and stress when done now rather than when you are anxious to make it to the closing table. You get your credit score, why not your title score? Your investment is huge, why jeopardize it?