Why Are There Issues With Getting A Title For A Property?
Making sure that properties are transferred between owners without fraud, misrepresentation, or other forms of bad-faith dealing is one of the foundational reasons the law exists. Critical to real estate law is the acquisition of a clear title. Most title searches range between completely uneventful and mildly annoying, but a few can turn up major issues that may stand in your way of taking control of a property. Let's explore some of the most common problems that can occur with getting a title.
Property is often used as collateral in obtaining financing. When this occurs, a creditor may place a lien on the property before providing the funds to a person or an organization. Until this lien has been taken off the property, the creditor has the right to intervene in any proposed sale to ensure its right to repayment comes first.
Not resolving liens can lead to a slew of problems. There may be questions about how the property was represented before the sale, potentially creating allegations of fraud. If a buyer knowingly takes possession of the property with an outstanding lien, they're giving the debtor a free chance to leave them with the bill.
Several solutions are worth exploring. The buyer might either assume the outstanding debt or pay it off as part of the purchase agreement. The current landowner may also find a way to either settle the debt or to put up something else as collateral.
Records of where the property lines are and what resources are at the site are kept at a registry controlled by the county. If previous surveys of the land were poorly done, there may be conflicts between the facts on the ground and what the register says. This can lead to disputes with neighbors or rights holders that even the best real estate law services firms will have to work for years to rectify. While it's certainly possible to move the title under these circumstances, a buyer will want some warning about what they're getting into before they make that decision.
A record of zoning, usage, code violation, and environmental problems can hold up a title. If a trash dump was on the land 50 years ago, for example, there may be outstanding fines and penalties, remediation issues and even toxicity issues. Taking possession of the title, even if the site had been grandfathered, may open up liability concerns.
For more information, contact companies like Johnson Motinger Greenwood Law Firm.