Title disputes can cause many problems for both new home buyers and their agents. Title disputes can occur when there are liens on a home. There are also concerns with zoning, falsified documents, and unpaid taxes. All of these problems have recently become a high risk due to the number of foreclosures on the market.
The process of buying a foreclosure includes an agent. It can be a long, difficult process and agents are in charge, which can cause problems for them and their clients. Agents are the only ones who can put a formal bid on a property.
Without title insurance, title disputes can affect home buyers because they can lose considerable money. They also may not be able to get the home they wanted if there are too many disputes. Title disputes are common in foreclosures. People who find themselves in financial trouble may make a claim against the title to get some money to avoid foreclosure. Often, however, this method does not work, but the claim remains on the property.
Other things that can cause title disputes are liens against a property or questions about the validity of documents associated with the home. There are several types of liens including equitable liens, general liens, judgment liens, and involuntary liens. Equitable liens are liens used to pay off a debt. For instance, a home may get a lien against it if the previous owners used it as collateral for a loan. General liens come from court judgments, IRS taxes, and probate actions. Involuntarily liens on a home arise from non-compliance with state statutes.
Certain situations lend themselves more to title disputes than others. A home that was involved in a divorce settlement may have general liens against them due to court orders. Title disputes can also become a problem if a home has changed hands several times. There may be times that a title signature is in question. If the signature is in question, that title then goes under suspicion of being falsified. Without a proper title, homebuyers and agents cannot complete a purchase. Agents for sellers will not be able to sell the home if the title's validity is in question.
Title disputes can cause considerable problems both for new home buyers and their agents. They can be costly. This is especially true if the home buyer does not purchase title insurance. Title disputes are common in foreclosures. This is true because in an effort to avoid foreclosures a home owner may put a claim against the title. They can also arise out of a suspicious title signature, out of court orders based on a divorce settlement, or when a home owner fails to pay taxes.