Title Search 101 for Investors - Part 5

This is the final article in this 5 part series.  The previous articles can be found here:

Title Search 101 for Investors - Part 1 - Title Search 101 for Investors - Part 2 - Title Search 101 for Investors - Part 3 - Title Search 101 for Investors - Part 4

There are 4 ways to eliminate a lien from a Florida property title. (1) The simplest way is for the lender/lienor to satisfy the lien which happens when it gets paid off. With a mortgage, you will find a "satisfaction of mortgage."  With the other types of liens, the document is typically called a "release of lien" or "satisfaction of lien."  The release or satisfaction document will reference the mortgage/lien being satisfied by official records book and page number. You can quickly eliminate a mortgage/lien in your title search by cross referencing the lien with the associated release. (2) The second way to eliminate a lien is by statute of limitations.  Court judgments in Florida currently have a lifespan of 10 years but can be extended for a second 10-year period by being re-recorded.  Federal tax liens have a lifespan of 10 years but can be extended indefinitely by being re-recorded.  Construction liens and condominium liens are valid for 1 year from recording. Homeowner association liens are valid for 5 years from recording.  Most other government liens are valid for 20 years. (3) The third way to eliminate a lien is to prove that it never really was a lien.  This is typically done with an affidavit from the homeowner.  Affidavits for non-identity, continuous marriage, and homestead are often recorded to show that a lien never attached to the property for various reasons. (4) The fourth way is by lawsuit or court order.  A foreclosure suit can often wipe out second mortgages and other junior lienholders.  Bankruptcy and probate can often wipe out general liens. With all liens except property taxes and code enforcement liens, what determines a lien's priority is the date/time it was recorded in the official records.  A $500 court judgment recorded prior to a $100,000 mortgage could potentially foreclose and wipe out that big mortgage because the court judgment was recorded first.

The last part of the title search is verifying the property taxes.  No document gets recorded in the official records when Florida property taxes are unpaid.  So you need to check the county tax collector's website to find out if delinquent property taxes are owed against the property.  Property taxes are a specific lien against the property and have super-priority over all other liens. If payment is not made, the property could eventually be sold at a tax deed auction and all other liens and ownership rights would be wiped out.  Here is the link to the Orange County Tax Collector's Office for this property.  For this example property, you can see that the 2010 taxes and all prior year taxes have been paid. The 2011 property taxes do not become due until November 2011, but still must be pro-rated at closing.

Below is a video that brings all of these articles together.  In this video we do a quick title search on the property mentioned throughout the article in Orange County, Florida. If I can be of assistance in helping you sort out a title, please contact me. Please keep in mind that an online quick title search may not be 100% accurate and is never a substitute for title insurance.