In all New York residential real estate transactions, it is vital for the buyer to ensure that the seller has clear title to the property. Failing to resolve a title issue before closing can subject the buyer to litigation, make it difficult to later sell the home, and other undesirable outcomes in the future. To guard against this possibility, it is recommended that a thorough title search be conducted during the purchase process. In the event that a serious title defect shows up, the buyer may opt out of the transaction or the seller may take steps to ensure that the defect is cured.

Common title defects

Title defects can vary in seriousness. One of the most common types of title defects is filing or clerical errors. These errors can affect the validity of a deed or survey, and may be expensive to resolve.

Unknown or hidden liens or encumbrances are common serious title defects. These can occur if the owner failed to pay off a mortgage or secured loan, or if the owner has a judgment entered against them. The lien created by these and other activities generally stays on the property even after the sale has been completed. As a result, it is important for the buyer to ensure that any outstanding liens are discovered and paid off before closing.

Like liens, unknown easements can be particularly troublesome for uninformed buyers. An easement may give another property owner the right to use the property to access a nearby public road, for example. Since easements can significantly affect the use, enjoyment and value of the property, it is important to discover their existence as early as possible.

Finally, survey or boundary disputes can be troublesome. Although the buyer may have seen several surveys of the property prior to the purchase, other surveys that show different boundaries may exist. As a result, a neighbor or other party may be able to claim ownership to part of the property.

Speak to an attorney

To protect yourself against title defects and the major problems they cause, it is recommended that you purchase title insurance. Additionally, it is important to engage the assistance of an experienced real estate law attorney. An attorney can ensure that any defects in the title are discovered and cleared up, ensuring that you receive all that you bargained for.