Title Defects: What is It and How to Settle Them?

close up shot of person signing a contract

As a new homeowner, you may think that the transaction ends once they’ve signed all the documents. As great as it would be if that were true, it is unfortunately not. There are some things that can actually threaten your titleholder rights called title defects.

What is a Title Defect?

A title defect is any kind of threat that you face as a homeowner, with the stakes being your right to claim or sell a property. If you buy a house, you want to say that you own it fully, and can do whatever you want with it! Title defects get in the way of that.

Title defects could include things like errors in the public records for the property, illegal deeds, delinquent taxes, disputes and other such things. When a property has a defective title, other parties can lay claim to it, which means that any transactions with it become impossible. If you try to sell a house with a title defect, you wouldn’t be able to, even if you went through all the legal processes the right way.

Title defects can become a problem when it comes to mortgages or loans because the lenders would want title insurance.

Remedying Defective Titles

A defective title cannot be sold or legally transferred to anyone until the defect is fixed. To do anything with the asset in question, you have to take care of all the issues that may lie with the title.

For example, if there is a tax lien on your property, you wouldn’t be able to sell it. You’d have to first pay off all the outstanding taxes to get the lien removed and then proceed.

If you try to sell a property with a title defect without settling the issue first, you can be held liable for damages, but can also lose all rights to the title as well.

To resolve the issue of a title defect, you need to get your attorney or title agent to launch the rectification process. Some title defects can be settled fairly quickly and easily – such as errors in data entry. Others may take more time, more money, and may even need court involvement.

Any title defects that include financial problems have to be paid in full and the receipt submitted to the records for the defect to be resolved.

It’s always better to protect your property against title defects than to have to run around trying to fix them later. But if you end up in an unseen situation where defects arise, don’t worry! There are ways to fix the problem.

If you’re looking for a Real Property Law firm Manhattan who can help you navigate through tricky topics like title defects, we can help! Visit our website to learn more about estate planning NYC

 

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Title Defects: What is It and How to Settle Them?

Ledwidge & Associates

Ledwidge & Associates, P.C. in New York City has years of experience helping clients create estate plans that fit their needs. We have the experience and resources to handle your critical legal matters with the utmost care and attention to detail.
Title Defects: What is It and How to Settle Them?

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