Title issues don’t occur often, but they certainly do happen. Sometimes issues are uncovered during title searches, and other times they are simply impossible to detect. They can go unnoticed for many years, during which the property may be sold multiple times. Although the types of issues can vary greatly, here are 5 common real estate title issues.

1. Clerical Mistakes

Anyone and anything is prone to human error. It’s simply a fact of life. For real estate transfers, typos can occur on property titles, paperwork can get misfiled (or not filed at all), dates can be mis-entered, etc. The process is certainly not fool proof. Some clerical errors are found during title searches, but small errors (like minor typos) may be easily missed and are among the most common real estate title issues.

2. Illegal Documents

Illegal documents are nearly impossible to detect. What makes a document, like a property deed, illegal? Here are a few examples:

  • Underaged Signers
  • Illegal Immigrant Signers
  • Signers Were Under Duress

As you can see from these examples, none of those issues would be apparent when viewing a deed or other document related to a property. So, these issues would not be uncovered unless someone became aware of it and notified parties involved.

3. Unknown Heirs

Another of the common real estate title issues involves unknown heirs. When a property owner becomes deceased, the property gets passed down to their heirs. Years later, an unknown heir may come forward and contest a will or even claim ownership in that property. At that point, the original heirs may not even own the home anymore. The new owners would be faced with a legal dispute as a result.

4. Impersonations and Forgeries

Signatures on legal documents are normally witnessed by a notary. Notaries are trained to check identification before verifying a signature. However, notaries are not responsible for confirming the validity of that identification. Signers could be using fake identification or impersonating the named persons. During a title search, there would be no way to detect forgeries or impersonations. Therefore, this type of title issue could go undetected for a long time.

5. Incorrect Legal Descriptions

All property deeds include a legal description of the boundaries of a property. This description normally gets copied over each time a property is transferred from one party to another. Typos are certainly possible when each new deed is written. Property boundaries can also change over time as parties buy or sell adjacent plots of land. Changes in boundaries are another opportunity for a mistake. Because these descriptions are so technical, one may not notice the error until many years after it occurred. That error could therefore pass down to current owners.

Resolving Common Real Estate Title Issues

The good news is, many title issues are covered by owner’s title insurance. This is why it’s important to consider purchasing title insurance when you first buy a home. One policy will cover you for your entire ownership period. Additionally, it requires only a one-time up-front fee to purchase. The cost is minimal considering the value of your investment and the peace of mind that it provides. If you failed to purchase title insurance when you closed on your home, it’s not too late. You may purchase a policy at any time. Contact us for details!