Get a title search, get a title search, get a title search

By
Real Estate Broker/Owner with Lane Realty Eatonton, GA Lake Sinclair, Milledgeville, 706-485-9668 GREC# 169695
https://activerain.com/droplet/5gnl

I almost typed that in all caps like I was yelling at you.  If you buy property and get a loan you will have a title search. However, for a cash deal it isn't a legal requirement, nor is title insurance, but IT'S STUPID NOT to get a title search. Even if you are inheriting property it would be beneficial to you to have the probate attorney do a title search or hire your own. (Granted your state may be different and you may be hiring a title company or escrow company) but in Georgia you want a title search you call a real estate attorney.

I have a contract on a listed property where no title search was involved on the previous transfer of title to the current owner.  I was made aware there was a loan on the property as was the closing attorney.  What I was not aware of was a lien.  A lien that was in place to the former owner before my seller got title by way of a quit claim deed.  And as it turns out that transfer (which came as a settlement) was now worth significantly less than prior belief because this lien has to be paid for my seller to transfer good title. So not only is my seller losing money, they are also losing time. And as we all know time is money.

We're waiting for some negotiations to take place between my seller the lien holder. Those could be lengthy because it's not a private party. And if you've ever waiting on the government to get back to you then  you might have an idea why I'm expecting lengthy.  In this case our buyer is willing to wait. But this all could have been avoided had the current owner had a title search at the time the transfer was made to them from the previous owner.

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Re-Blogged 3 times:

Re-Blogged By Re-Blogged At
  1. Patricia Feager, MBA, CRS, GRI,MRP 11/28/2018 06:04 PM
  2. Gita Bantwal 12/06/2018 04:21 AM
  3. Gabe Sanders 12/13/2018 10:00 PM
Topic:
Home Buying
Groups:
Georgia Real Estate
Welcome to my Neighborhood
Tags:
title search

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Rainmaker
967,532
Corinne Guest
Barrington Realty Company - Barrington, IL
Barrington Home Buyer Advocate

I've never had anyone refuse one, but here the attorneys are in charge and they are going to save their butts, so they always order one. Have never had anyone object to title insurance either, again their attorney is in charge. The scariest event I had was when we sold a home 2 years after buying it. Cash deal, daughter came to live so they bought her a house. After we closed the sale I reminded them to cancel the house insurance. Mr & Mrs, Mom and Dad, looked at each other....then said what property insurance. Yes it was uninsured for two years!

Nov 30, 2018 10:52 AM #28
Rainmaker
1,451,849
Marte Cliff
Marte Cliff Copywriting - Priest River, ID
Your real estate writer

Following Corinne Guest's comment - Several years ago my husband built a house for a gentleman. When he passed away his 2 daughters inherited the house and spent a lot of money finishing the basement. Then they left the house in the care of an agent who had been a friend of their Dad's. 

He didn't bother to get the house winterized or to keep the drive plowed so the fuel truck could get in over the winter. When Spring came some other friends went by to check on the house. The newly finished basement was now unfinished, with the sheetrock floating in a couple of feet of water.

The daughters said they didn't know they needed to keep the house insured, since there was no mortgage.

Nov 30, 2018 12:31 PM #29
Rainmaker
256,068
Elisa Uribe Realtor #01427070
Golden Gate Sotheby's International - Oakland, CA
California Homes for Sale in the East Bay

I agree with you 100%. It is at the core of every successful RE transaction. 

Nov 30, 2018 02:49 PM #30
Rainer
97,189
Anne Corbin
Fritz Realty LLC - Spotsylvania, VA
Serving Lake Anna & Central Virginia

Title searches are critical!!!

Nov 30, 2018 05:39 PM #31
Rainmaker
242,318
Alan Grizzle
Chestatee Real Estate - Dahlonega, GA
Full Time Realtor, Lifelong Resident of Dahlonega

I ran into the same thing. A client bouht a home from a friend who was getting diviorced. He gave the friend a life estate to live in the house provided the friend paid rent. The so called friend would not pay him so he had to go to court to terminate the life estate. He got the judgment, "friend" trased the house and moved out. He listed the house, we got it under contract and found a security deed that did not get cancelled. The lender solod the loan, new lender went out of business. The buyers attorney never could get the bank that aquired the lean signed off andthe buyer walked. Meanwhile the mold problem in the house worked. I finley got a new buyer and a local attorney to get the lean released. It closed but in cost the seller a lot of time and $15,000 less than the first contract. All to save a $150 title search.

Nov 30, 2018 07:13 PM #32
Rainer
464,022
Sham Reddy
H E R Realty, Dayton, OH - Dayton, OH
CRS

Its dangerous, ignorant and downright stupid to bypass title search before buy a piece of property

Dec 01, 2018 04:09 AM #33
Rainmaker
164,555
Janelle Ancillotti
Seneca Home Staging - Syracuse, NY
HSR Certified Home Stager, Syracuse, NY

Thank you for using the correct words "quit claim" and not the other word that a lot of people use incorrectly! 

Dec 01, 2018 06:15 AM #34
Rainmaker
1,148,814
Carol Williams
U.S.: I specialize in helping agents who have been in the business 2 years or less create a thriving business. - Wenatchee, WA
"Customized Mentoring & Marketing Services"

Hi Tammy,
It doesn't happen all that often but bad things can happen when there is no Title Search or Title Insurance.  I once had to use my title insurance.  There was a $10,000 lien that was not cleared when I took ownership of a small piece of orchard property. When I went to sell the property, the lien reared it's ugly head.  However, the Title Company paid promptly on the policy and closing went smoothly.  I never did understand why it wasn't paid off when I took title but that wasn't my problem, thanks to Title Insurance. 

Dec 01, 2018 08:34 AM #35
Rainmaker
372,977
John Wiley
Right Move Real Estate Group- EXP Realty - Fort Myers, FL
Lee County, FL Real Estate GRI, SRES,GREEN,PSA

A buyer should always want to know what they are buying. To be sure that the seller can indeed provide a "clear title" which means no leans also, then a title search is to be conducted.

In Florida the "common" practice is that the seller pays for buyers title insurance. Most lenders require there be title insurance that covers the lender also.

I consider title search to be standard and best practice.

Dec 01, 2018 09:12 AM #36
Rainmaker
40,015
Ricardo Mello
Manhattan Miami Real Estate - Manhattan, NY
Manhattan & Miami Real Estate Agent

Always!

Dec 02, 2018 06:13 AM #37
Rainer
264,429
Ron Aguilar
Continental Mortgage - Saint George, UT
Mortgage & Real Estate Advisor since 1995

Excellent post, Title is very important as we in the lending industry know. Thanks for your time.

Dec 02, 2018 07:20 AM #38
Rainmaker
751,324
Thom Abbott
MyMidtownMojo.com |770.713.1505 | Intown Atlanta GA Condo Living - Atlanta, GA
Midtown Atlanta GA Condos For Sale

And I'll echo it with Title INSURANCE, title INSURANCE, title INSURANCE!  I've got a listing right now, and my Seller got tax notice for a tax bill when she did not own the property, but she's now expected to pay it. It was a screw up when the Seller we bought from purchased the property and a tax payment at closing got applied to a different property address. Whoops. 

Title Insurance company is handling it all. 

Dec 02, 2018 11:16 AM #39
Rainer
83,488
Brian DeYoung
Howard Hanna Real Estate Services - Ithaca, NY
Brian DeYoung

ditto for the survey.

i know a party that closed on their ( cash purchase) or land and a cabin, and learned later... the cabin was 100 percent on a neighborong property.

 

Dec 02, 2018 04:43 PM #40
Rainmaker
139,783
Eva B. Liland with Century 21 Doug Anderson
Century 21 Doug Anderson - Lancaster, CA
Glad to be of Service

I mostly deal with manufactured homes on leased land in park communities. This has inspired me to write my own blog post because belive me, that is worthy to stress the fact, lol.

Dec 02, 2018 04:54 PM #41
Rainmaker
471,512
Mary Hutchison, SRES, ABR
Better Homes and Gardens Real Estate-Kansas City Homes - Kansas City, MO
Experienced Agent in Kansas City Metro area

I usually order a title search right away if I think there may be any unusual questions about the title...better to find out about it early on than a week before closing!

Dec 03, 2018 11:53 AM #42
Rainer
418,186
John Dotson
Preferred Properties of Highlands, Inc. - Highlands, NC - Highlands, NC
The experience to get you to the other side!

Tammy,

I have seen Title Searches and resultant Title Policies save folks "bacon" over the years.

Folks ask if they need a title policy and I always give them the "death stare" - same thing with new/updated surveys.  It may cost a little more at the time but it is "insurance" you can not buy later.

Dec 03, 2018 02:37 PM #43
Rainmaker
232,969
Susan McCall, Everyone needs a home
Compass Realty Solutions, Portland, OR & Vancouver, WA - Portland, OR
Quickly, professionally and with a little fun!

Yup, think of the money you will save on that title search.  Totally makes sense.  Cash buyers think they own the world because they have CASH!!!

Dec 03, 2018 03:21 PM #52
Ambassador
3,786,362
Jeff Dowler, CRS
Solutions Real Estate - Carlsbad, CA
The Southern California Relocation Dude

Hi Tammy

Having a title search done is always a smart thing, and it's done routinely here through a title company, cash or not. And that title insurance is pretty darn important, too! Good luck with your seller's title situation!

Jeff

Dec 03, 2018 05:20 PM #53
Rainmaker
3,641,820
Dorie Dillard CRS GRI ABR
Coldwell Banker United Realtors® ~ 512.750.6899 - Austin, TX
Serving Buyers & Sellers in NW Austin Real Estate

Good morning Tammy Lankford, 

I'm so glad that Gita Bantwal re-blogged your post as I missed it. A title search should always be done and the example you give is exactly what can happen when one isn't done. Its always worth the cost!

Dec 06, 2018 05:20 AM #54
Rainmaker
4,634,837
Gabe Sanders
Real Estate of Florida specializing in Martin County Residential Homes, Condos and Land Sales - Stuart, FL
Stuart Florida Real Estate

Thanks, Tammy.  Great advice for every single buyer out there.

Dec 06, 2018 05:21 AM #55
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