Legal Issues Your Real Estate Attorney Might Encounter During Title Search

After your escrow account was opened, you will get a copy of the Abstract of Title or Preliminary Title Report. This will include some information about the real estate that you are buying or selling.

Importance of Title Search

The report will let you know about the liens, judgments or any encumbrances against the property or the owner of the record. Other details such as the survey maps, legal descriptions, property taxes, and easements are included in the initial report. The initial findings should not cause any concern. If some issues were uncovered such as an unknown right-of-way, notice of a pending lawsuit, utility easement or judgment against the seller, these could cause a delay or even cancellation of the sale.

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How long will a title search take

A title search can take from few hours to two weeks to finish. The time depends on how many documents need to be reviewed. The findings of the title examiner will give you information about the most recent status of the title as of the releasing of the report. Aside from the information mentioned above, the report will reveal the vested owner’s name based on the public records, the latest real estate taxes, physical description, and restrictions. It will also detail what is the condition of the title which the lenders title and escrow will issue insurance.

This report is vital for your escrow officer as it is required in completing escrow. The data in the report will let you know what are the things that should be fixed so that the title can be transferred from seller to the buyer.

Possible problems with a title and their solutions


An issue that sometimes shows up is that the seller has a co-owner on the title and that person is in other location. An arrangement should be made so that the co-owner will sign the necessary documents. Obtaining a power-of-attorney for the other party is another way to resolve this issue. There are times that the title is held by a trust or a probate waiting for final disposition. In this case, the parties named in the trust should be found and relevant parties must obtain the probate settlement.

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Easements and right of way

Another possible problem that can delay the closing of the sale is assessment bonds, delinquent taxes, and judgments. Other judgments filed in the different county will also be seen on the title report. All outstanding judgments have to be paid at closing. As for the easements and rights-of-way, they need to be located by residential real estate attorneys so that you won’t have any problems in the future. Though it may be inconvenient, it’s best that you personally inspect the property with the title report as your guide. Don’t make the conclusion that a row of trees, fence, or hedge set the boundaries.

Title Judgement

Another judgment is the buyer has a similar name to another person. This can be fixed by an affidavit from the concerned party attesting that he or she is not the person named in the judgment. Another similar situation is a creditor, for example, a department store will claim that a judgment is also against a person with a similar name. If that is the case, your title attorney will get in touch with the creditor to fix this discrepancy. Whether you are aware of these judgments or not, you still must settle them. Most of the time, if there is a money owed by the third party, the creditor will agree to release but the amount owed should be paid at the close of escrow.

Notice of a pending lawsuit

Another problem that may be discovered in the title report is a “lis pendens”, it means that there is a pending lawsuit. It warns potential buyers of the property that there is an on-going dispute over the title and that any future buyers will be bound by the final resolution. Majority of title insurance companies don’t want to ensure a title with “lis pendens.” There is a number of reasons why there is a “lis pendens” on a title. If a seller filed a bankruptcy and backed out of a sale but the buyer is persistent, he/she can record a lis pendens so that no one can buy the property until the dispute is settled.

To make sure that you will have a smooth closing transaction, plan and address the issues that you will discover. With some of the issues that may be hidden in a title, it is important that buyers should work closely with their title escrow company to make sure that the property they are planning to buy has a clean title.

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