Title Problems That Can Kill Your Real Estate Closing

A clear title is necessary for a successful real estate closing, but there are a couple of title problems that can derail transactions. A closing can fall apart, for example, if there is a break in the chain of title — which occurs when a deed showing the transfer from one party to another is missing and needs to be tracked down and recorded or when a deed was recorded improperly or with the wrong information. Although an affidavit from the people involved can remedy such problems, it becomes a bigger challenge when the problem occurred years ago and the parties are deceased or otherwise unavailable. Such a situation requires a “quiet title” action that calls on the court to determine who actually is the current owner, and the transaction can proceed only if the seller is found to be vested in the title. Another problem involves encroachments on the property, which can be resolved by removing the offending structures and erecting a fence on the legal border. However, if part of the structure overlaps, the integrity of the house could be jeopardized by removal, requiring the owners to bring an “adverse possession” claim before the court that would enable them to claim legal title to the land because the encroachment occurred over an extended time period. For such a claim to be approved, the encroachment must have been obvious to all and not opposed by the owner of the property being encroached. | Read More