What are Title Clouds and What Can Be Done About Them
When we conduct a real estate closing at the Lake of the Ozarks, our job is not just to oversee the handing over of the keys to the house. We are there to make sure the actual legal ownership of the property officially and completely transfers from the seller(s) to the buyer(s). If there is any question or limitation on the seller’s right to own the property, the buyer may not be get the full ownership they expect. Whenever there is a doubt or question as to the property’s ownership, it creates what is called a title cloud. If you would like to learn more about clouds and what can be done about them, keep reading!
Clouds.
A cloud on title is also known as a title defect. The title to your house is the document that
proves the homeowner has the legal right to own the property. When there is a cloud on the title it indicates
there is some question on who owns the home, whether they are free to use the
property as they wish, or if there is some liability for the potential
buyer. This can be a discrepancy regarding
the current owner or something questionable about the history of the property
prior to the current owner that has been left unresolved.
Examples.
Here are some of the more typical examples of clouds on
titles that we see when doing a title search at Lake of the Ozarks:
An unpaid lien on a property is a good example. It can be unpaid taxes, a loan where the
house is used as collateral, a mechanic’s lien for work done on the house … until
the lien is paid off, it will create a cloud on the title. Probate can also
cause a title cloud. If the late
homeowner did not designate in their will who would inherit the home, ownership
is unclear. If the home is in
foreclosure or involved in a law suit regarding ownership, the title will be
clouded. Recording errors in public records can also cause clouds and must be
corrected to ensure ownership rights. In
addition, fraud and forgery can cause discrepancies on ownership of a property.
Solutions.
Finding a cloud during a title search at the Lake of the Ozarks
can be a huge problem, or not. The main
thing is knowing about them before you buy the property, and having a title
insurance policy to protect your ownership rights should something unknown
arise after the purchase. That is why it
is so important to have a reputable title company at the Lake of the Ozarks
complete a full title search and provide you a full report. Often, at Arrowhead Title, when we discover
a title cloud we are able to simply resolve it.
It may be as easy as paying off a debt that was overlooked (or properly
recording it as paid), or obtaining a missing signature. However, some clouds can be very costly and time
consuming to correct. For that reason, any clouds can be problematic to a buyer
or lender and can cause them to walk away from the sale.
Having a professional title company on your side can make
all the difference when it comes to title clouds. Receiving a title report early in the process
and knowing exactly what it means allows you make an informed decision on whether
to purchase the property. Clearing title
clouds BEFORE you go to the closing table and purchasing a title insurance
policy can give you peace of mind and security as you make the long awaited decision
to buy a home at the Lake of the Ozarks.
We want that experience to be everything you hope for. When you are ready to buy or sell real estateat the Lake of the Ozarks, give Arrowhead Title a call … because we know accuracy
really does matter!
The Lake of the Ozarks' Most Trusted Title Company
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