Your Success Is Our Mission

3 tips for avoiding title disputes when buying a house

On Behalf of | Nov 11, 2022 | Real Estate Law |

Title records for real estate are what officially establish ownership. The county keeps a record of every property transfer that occurs and of any lien someone records that result from a court judgment or a contract. Those title records protect individuals from fraud and misconduct and allow for all parties with a financial interest in a property to know whenever transactions involving that property occur.

Occasionally, title disputes will arise when people try to buy or sell real property, often because someone claims to have an interest in the property. There can also be title issues that sprout up unexpectedly when someone has lived at a home for years.

How can you potentially avoid a title dispute in the future when looking at real property?

Secure a thorough title review

There are many large title insurance companies that have all but automated the title research process. These big businesses won’t pay much attention to detail because accuracy is nowhere near as important to them as the volume of policies they how.

Smaller, local title companies have much more to lose, including their reputations, if they miss an issue during a title search. Better title services will decrease the likelihood of a dispute arising later because a professional overlooked a possible issue.

Invest in enhanced title coverage

Standard title policies actually cover less than people realize. Issues like future fraud won’t necessarily have any protection if you just buy a basic title policy. More thorough, enhanced title policies offer much more comprehensive coverage.

These enhanced policies also often involve a much more thorough review of the property’s history during the underwriting stage. Those with older or particularly valuable properties may find that enhanced policies are useful because of how many different potential sources of title disputes there might be.

Avoid high-risk properties

There are some kinds of real estate that are at higher risk of title claims than others. For example, property sold as part of an estate could become embroiled in a title dispute later. If there are beneficiaries that did not receive proceeds from the sale or proper notice, property sold during a divorce might also eventually lead to title disputes, as could properties with multiple owners sold as part of a foreclosure.

Proactively planning to avoid common title disputes will help those thinking about purchasing real estate in the near future.