In Real Estate, title means a Right to Ownership, or a document stating a Right to Ownership.
Various kinds of claims can "cloud" a title. Some examples are:
Forged deeds, mortgages, satisfactions or releases of mortgages, and other instruments.
Impersonation of the true owners of the land by fraudulent persons.
Outstanding prescriptive rights not of record and not disclosed.
Undisclosed or missing heirs.
Liens from unpaid estate, inheritance, income, and gift taxes.
Defective acknowledgment due to lack of authority of notary. (Acknowledgment taken before commission or after expiration of commission.)
Descriptions apparently but not actually adequate.
Deed from bigamous couple - prior existing marriage in another jurisdiction.
Mistake in recording legal documents. (For example, incorrect indexing or errors and omissions in transcribing, and failure to preserve original instruments.)
Special assessments where they became lien upon passage of resolution and before recordation or commencement of improvements for which assessed.
Recorded easement, but erroneous ancient location of pipe or sewer line which does not follow route of granted easement.
Undisclosed divorce of spouse who conveys as sole heir of deceased consort.
Deed from record owner of land where he has sold property to another purchaser on unrecorded land contract and the purchaser has taken possession of premises.
Tax titles invalid because of irregularity of proceeding, reversal of court decisions, or lack of decisions on points of law.
Fraud, duress or coercion in securing essential signatures.
Deeds by persons of unsound mind.
Invalid, suppressed, undisclosed, and erroneous interpretation of wills.
Keeping it Safe
The best way for you to protect your interest in a Real Estate transaction is obtain the services of a Title Insurance Company.
What will the Title Insurance Company do for me?
Trained personnel will perform a title search to verify ownership and to identify any possible "clouds" on title.
The result will show if the seller has the right to sell, indicated by ownership, and indicate any problems; i.e. liens, etc.,
that need to be resolved or acknowledged by the buyer before transfer of property.
Next, the title insurance company will insure the new owner against the possibility of error or forgery in the transfer of title.
This is the transfer of title. This insurance is in effect the duration of ownership. Title insurance is paid one time. Two separate policies are issued:
Owners Policy - Protects the new owner in any subsequent claims to the property
Lenders Policy - Protects the lender against loss of unpaid loan balance in the event of a claim.
To request a Closing Protection Letter on behalf of a lender for a pending transaction, click here and complete the form.
Please note that underwriting approval may be required before the CPL is issued. Please contact your Title Officer with any questions.