What types of problems may plague property titles?

A thorough review of a property’s title during the purchase process is essential in order to avoid problems down the road.

People who buy real estate in California may well know that a review of the property's title is part of the sale process. This applies to property that involves land alone or that may also include one or more structures on the land. The title review process is an essential component of any real estate purchase and should not be taken lightly. Understanding some of the problems that may be found during or even after a sale is important.

Incorrect information due to human error

First American, a title company, explains that property titles are matters of public record yet there are steps in the titling process in which human error can introduce problems. For example, someone may mistakenly enter that a home with four bedrooms has only three bedrooms. This seemingly simple error can complicate a purchase or finance process.

Liens on property

According to SF Gate, many things may result in a lien being placed on a property. The presence of a lien may prevent a purchase from being completed as originally hoped unless the lien is able to be properly addressed.

The Washington Post explains that not all liens against a property may actually relate to debts owed by the current owners. When contractors perform work on homes or other buildings, they may place what is called a mechanic's lien on the property. This protects them in the event that their customers do not pay them. These liens are supposed to be removed once the work is done but sometimes this step fails to happen and the lien is discovered during a title review in a sale.

Fraudulent actions

In a world of identity theft and other crimes, it should be no surprise that people may also try to fraudulently claim ownership of property. A title review may discover that a particular transaction was not properly documented or notarized, for example. These may signal potential fraud.

Unknown heirs, wills or trusts

If a property owner dies, great care should be taken to locate any estate planning documents or surviving heirs. There may be cases when this does not happen immediately upon a person's death. If a property is sold but later on a will is found or an heir appears, a conflict with the title may result.

Property lines and easements

Rights of way like easements must be documented accurately. A title review may well bring to light an easement that was previously not identified. This may force a review of the sale details.

Real estate transactions are legal matters

When the potential for a dispute over the ownership of a piece of property arises, the reality that a real estate purchase is a legal transaction becomes very clear. For this reason, it is recommended that California residents always consult an attorney when they have questions about a property title or purchase.