How to Know if a Real Estate Title has Title Defects in Florida

How to Know if a Real Estate Title has Title Defects in Florida

If a real estate title has title defects in Florida, the property may not be marketable. Whether you’re a buyer or a seller, it’s crucial that you have knowledge of the chain of title.

In this blog, we’re going to give you a 101 on title defects in Florida and how a Florida real estate attorney can help:

What Is a Title Defect in Florida?

Title defects in Florida are any factor that ‘clouds’ a real estate title, causing complications in a transaction. Title defects may include public records errors, liens, judgments and encumbrances.

These complications can potentially cause a big stumbling block for buyers and sellers and potentially leave the seller liable for damages.

Title defects involve other parties laying claim to the property, which means the real estate title cannot be legally transferred to the buyer.

Title defects are also referred to as ‘bad titles’, ‘clouded titles’ and ‘unclear titles’.

How to Check a Chain of Title for Title Defects in Florida

To know if a real estate title has title defects in Florida, you will need to perform a title search.

A title search is a delve into the public records, where you can discover a property’s chain of title and reveal any claims or liens.

Title searches are performed by Florida real estate attorneys or title companies.

Our attorneys will perform a search for title defects using public records and legal documents, revealing the truth of the chain of title.

It is not recommended that you conduct a title search alone. Documents can be confusing and one simple mistake can be extremely costly.

It is also usually a complicated process to gain access to the courthouse records. Our Florida real estate attorneys can do this smoothly, on your behalf.

What Next?

Once a Florida real estate attorney has performed their title search, you will receive a preliminary title report.

This will reveal if there are any title defects, which can be reported back to the seller.

You will also need to communicate with your attorney at this point, for expert advice on whether you should go through with the agreement. Title defects can be cleared up quickly, but in some scenarios, they can cause the entire deal to come crashing to a halt.

Common Types of Title Defects in Florida:

Public Record Errors

Any errors in description or recording, such as marital status or missing heirs, can cause titles to be defective.

Inaccuracy of Ownership

Titles must be filled with the correct name of the owner. Sadly, there have been occasions where the wrong name or owner has been recorded, requiring fixes before the sale can continue.

Judgments Against Owners

If a court ordered a debtor to pay a creditor, the creditor can place a lien on the property. The most common way to remove this lien is to repay the debt before the title is transferred.

Other judgments may include unpaid taxes.

Undiscovered Encumbrances

If a third party has claims to a real estate title, it is called ‘unknown encumbrances’.

This may be a right to a share of the property or use of the property.

These types of title defects can often be decades-old, hidden mortgages. A Florida real attorney can get to the bottom of any title defect such as this, to help you close.

Unknown Liens

Any lien attached to a real estate title suggests that someone who is not the rightful owner still has rights to a share of the property.

Adverse Possession

Adverse possession refers to the permit for an individual who possesses the land of a third party to claim title of the property.

Boundary Disputes and Unknown Easements

Mistakes during property surveys can result in boundary disputes and easements.

If this error is overlooked, it can remain on the title for years. These title defects can cause disputes with neighbors and third parties, causing distress for new owners if not detected before the purchase.

Forgery and Impersonation

Sadly, forgery and fake signatures or documents are used to transfer titles in Florida and can cause disruption later if not detected.

How to Resolve Title Defects in Florida

Any real estate title that is defective in Florida is unmarketable. The title and the property cannot be legally transferred until the title defect is resolved.

The titleholder must take care of all and any issues. For example, if there are tax liens on the property, the homeowner must pay off outstanding taxes before going through with the sale.

If they don’t, but still sell the property, they could be held liable for damages.

If you are a buyer, you should contact a Florida real estate attorney to help you perform a title search and conduct any necessary legal action.

Title Insurance

Title insurance protects homebuyers from financial loss if there are any unknown title defects in Florida.

The most common types are lender’s title insurance and owner’s title insurance. Most owner’s title insurance will cover:

  • Ownership by other parties
  • Forgery and fraud
  • Incorrect records
  • Easements
  • Encumbrances, judgments and liens.

Without title insurance, you are taking a massive risk, which is why almost every real estate purchase and sale we’ve worked on has included title insurance.

Our Florida real estate attorneys can help you find the optimal policy for your circumstances, whether you’re a buyer or seller.

Contact a Residential Real Estate Attorney in Florida

Whether you’re a buyer or a seller, title defects in Florida are time-bombs for real estate purchases or sales.

Our Florida real estate attorneys can help perform a title search and take the necessary legal action to protect your interests and ensure you don’t suffer financial losses.

Feel free to contact our Florida real estate attorneys today for a free consultation.

Free Consultations

If you’re purchasing property or land in St Petersburg, Florida then contact us today. Our attorneys, Ross and Purdun at Battaglia, Ross, Dicus & McQuaid, P.A. have extensive experience that can help you secure your purchase or sale.

By |2022-01-02T09:47:19-05:00December 21st, 2021|Asset Protection|0 Comments