Do You Need a Closer? What you NEED to Know When Closing on Your Home!

You have submitted your offer and it has been accepted, now what?

There are many things that go on behind the scenes as you patiently wait for your loan to go through underwriting and for the paperwork to get settled for you to close on your new home. In all real estate transactions the title company will run a title search and examine public records to look for past deeds, wills, trusts, divorce decrees, bankruptcy filings, court judgments and tax records that may be faulty or outstanding.

It’s imperative that the title company you are working with is ahead of schedule, as any title issues that come up must be cleared up before the transfer of ownership happens. Knowing what some of the most common issues to look out for can be a huge help, really stressing the importance of using a realtor.

So what should you look out for when the title company gives you the preliminary title report? If you aren’t sure how to read it make sure you see your title agent for explanation on each item.

Items that may come up on the initial title search

Unknown Liens

This is the assurance that the contractor has when doing work on a home or property. The contractor would place a lien on the property before starting the work to ensure payment once the work is completed. Usually the problem comes up when the contractor fails to file a “satisfaction” of the lien and it remains on the properties title.

It’s imperative for the title company to make sure that the lien was filed properly and recorded in the public records. A mechanic’s lien can usually be resolved without much problem but it can be time consuming and could delay your closing.

Bankruptcies or Child Support

This is another source of title issues. One common occurrence is when a seller buys a property while single but then gets married to someone who has recently filed for bankruptcy. The title company must make sure that the spouse has signed off on the deed, and if not it, would be required to petition the court to release the property.

Another problem arises when a divorced parent does not remove a lien for child support. If the child in turn inherits the father or mothers property, a lien placed by the opposing parent could show up in the title search and it could potentially prevent a sale. The child would have to get the surviving parent to sign off that the debt has been paid in full in order to have a clear and transferable title.

Errors in Public Records or Forgeries 

When clerical errors affect your home ownership rights, it could be devastating. Errors such as an improper address or incorrect square footage could cause issues when running title searches. In this day and age we don’t live in a completely honest world. It’s important for the Title Company to run title searches to make sure there are no forged or fabricated documents that could potentially affect the ownership of the property

Boundary and Unknown Easements

This is a critical portion of the title and lien search. If you don’t know there are certain easements that could prohibit you from using your future land and or home it could cause serious consequences. Having the most up to date survey is also crucial for the home buyer as prior surveys could give neighbors or other parties the ability to claim ownership to part of your property.

What can you do to prevent issues in the future? The best thing you can do is to get title insurance, which will protect against any title problems that may come up after you close your real estate transaction. To get a quote on the cost of the policy speak to your title and closing agent. The cost for a policy is a one-time fee and the policy remains in effect as long as you own the property.

If you have any further questions about closing your transaction or issues that could come up please don’t hesitate to reach out to me. Call Albin Hubscher at 407-404-4041.

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