Defend your Title – 4 Common Title Problems

You have just closed on your new home. You have signed your name for what seems like hours.  With deed and keys in hand, you’re off to move in and get settled knowing that you are protected and safe in your new home. You may think that everything is just fine, but what if the sellers long lost Uncle John comes knocking on the door. He says he has a deed to the property or an unrecorded will granting him ownership rights.

This is why you purchased title insurance. There are many common title issues that could arise after the closing. These are 4 of the most common issues and how your title insurance will protect you.

·      Undiscovered encumbrances occur when a third party holds a claim to part of all of your property.  This could be an unrecorded lien because the seller has not paid a contractor for work done, a deed restriction or covenant that limits the type of shed you can build, or a license granted to a neighbor to store his fishing boat.

·      There could be an error in the public records. While we think we are perfect, we are human and we make mistakes. There could be a clerical or filing error that affects the deed. There could be a mistake made in the survey, or an easement that is missed or forgotten. 

·      You may own your home and the land around it, but there could be an unknown easement that would restrict or prohibit you from using the property any way you would like to. The utility company or another property owner might have the ability to enter or use the property, right where you would like to build that shed.

·      The property may be new to you, and if it is not brand new, then it could have had several owners. No everyone is a diligent accountant or bill payer. A lien for the debts of a previous seller could be placed on the property after you own it.  The debt may not be yours, but it will be your problem. This is a common problem with distressed properties.

Title issues can cause great financial hardship, and limit the way you can use your new property. Title claims can be very expensive and can even affect the value of your new home. With title insurance you can rest assured that you would not have to deal with these concerns on your own.

The good news is that in the large stack of papers you received at closing, there is an Owner’s title policy, which will cover any title issues that arise after closing. The title company will help defend and pay claims on your title, so you wont have to go it alone.  If you have any questions about title insurance, feel free to contact me directly at 215-519-1399.