Title defects can be incredibly detrimental to any real estate transaction, particularly if they are not caught early. If you are not careful, you may find yourself dragged into court over a property with a defective title. But what exactly does it mean for a property to have a defective title, and what are the potential legal consequences?
What is a Defective Title?
A property’s title is considered defective whenever there is some kind of issue that brings into question the full and legitimate ownership of a property. This may mean there is some kind of discrepancy in the paperwork for the property, or it may mean someone else holds some kind of unresolved property interest. Whatever the reason, the defect must generally be dealt with before the sale can go forward without issue.
Why Might a Title Be Defective?
There are many reasons that a property might be considered to have a defective title. These include, but are not limited to:
- Unpaid mortgages or liens
- Undisclosed easements or covenants
- Unpaid property taxes
- Disputes over boundaries or survey data
- Errors in public records
- Fraudulent or erroneous documents
- Undisclosed heirs
- Unpaid legal judgments against the property
What Are the Legal Consequences?
If you discover a title defect prior to the completion of the sale, it is usually possible to correct it in order to ensure the property has clear title, meaning it can be sold without issue. However, if you do not discover a defect until after closing, it is possible that you may be dragged into litigation to resolve the problem. This can potentially take months or years, and may require significant expense, so it is always best to discover the problem before things go too far.
What Should You Do?
In order to protect yourself against the worst case scenario, you should speak to a lawyer with experience handling real estate law. They can help guide you through the process of purchasing or selling your home, and ensure you are protected against title issues or other potential legal problems. The sooner you call, the sooner they can get to work for you.
At David J. Lorber & Associates, PLLC, we assist clients throughout New York who are looking to buy or sell real estate. We will guide you through the process and help you minimize your legal and financial risks. Call us at (631) 750-0900 or contact us online to schedule your Free consultation at our Setauket office.
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