“In any closing, but especially a Florida closing where someone is buying their primary residence, that buyer assumes that the seller is legally transferring full ownership of the land, and the improvements built upon the land (house, driveway, fence, sewer drains or septic systems, etc.), free and clear of any liens or encumbrances. However, those assumptions can sometimes be wrong. If the seller is unable to convey “clear title” (the term used in most Contracts is “marketable title”) to the buyer, then the transaction should not close. The closing should not happen because the seller cannot transfer what he or she has agreed to sell to the buyer in most Florida residential real estate contracts” (AboutFloridaLaw).
This is why it is imperative that a Florida title search is done before any papers are signed and before the transfer of any property title is finalized in the state of Florida. A simple search can reveal issues that could come back to haunt both the buyer and seller years down the road. And investing in simple title insurance can help protect purchases and title transfers from any undetected issues. A clan Florida title is critical to having a smooth transfer.
Title Search and the Title Report
Before the final papers are signed and well before the final closing, a title search needs to be performed in order to confirm that the seller has legal claim to the property they are attempting to sell and to make sure that there are no discrepancies over who actually owns the property or who has a claim to it.
The title search will also reveal marks on the title such as a lien filed for work that was done on the home yet still remains unpaid or liens placed on the title for owed back taxes and other state or federal fees. Anything that interferes and makes the title unable to be transferred is known in the real estate world as a “cloud on the title.” It is imperative that the seller takes steps as soon as possible to get these matters resolved before closing can take place.
In some counties, Florida title searches are performed by the closing agent who is overseeing the legal aspect of the transaction. These are individuals who have expertise in investigating real estate records and claims against the property. There are others who are also legally allowed to perform the searches and all findings, regardless of who conducts the search, will be compiled and filed as part of the paperwork for the title transfer. Once the buyer gets their copy of the title report, the seller can begin working to resolve any issues that have been brought up from the title search. Until those clouds are taken care of the Florida title for that property is deemed clean, it cannot be transferred.
Title Insurance Policies
In Florida, title insurance on of the most essential components of a title transfer and is a key element in the real estate industry. Florida title insurance plans help to facilitate the accurate transfer of property between buyer and seller. It is also the piece of the puzzle that makes it possible for mortgage lenders to confidently lend money to property owners. Without the insurance, the lenders would be taking a full risk gamble with the mortgage loan, which is something they do not want to do!
A title insurance owners policy is a special type of insurance policy that offers protection for the owners of real estate if there is ever a defect in title, a valid lien is found, or other legal claims are levied against the Florida title. If there is a successful challenge to the policy holder’s title, the company who issues the title insurance policy will pay for the damages that come up to the agreed to amount of the policy. It is a great way to add a layer of protection in the event something should ever come along that threatens your claim to the title and the property itself.
Title insurance is a part of almost every residential real estate closing that takes place in the state of Florida. Lenders mandate that title insurance policies be in place before they issue any loan and nearly every cash buyer usually ends up asking for an owner’s title policies, too.
Contact True Title Today
Florida title insurance can be tricky and Florida title searches can be complicated. It can be confusing to know where to turn and it is easy to get overwhelmed. That is where the friendly and knowledgeable team of realtor experts at True Title of Florida can come in and make a world of difference! “In almost all real estate transactions, there are title issues that must be cleared up in order to transfer ownership of the home from the seller to the buyer. Does the seller have the legal right to sell the property? Is the home’s title free of “clouds” or “defects” — such as judgments, liens or bankruptcies — that would prevent the seller from transferring “clear” or “marketable” title to the buyer? How can you be sure? Title companies report that in more than one-third of all real estate transactions they must undertake “extraordinary work” to address title issues” (The Washington Post). That is what we here at True Title do each and every day for all of our clients. So call today for a free consultation and let us help you with your Florida title needs!