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Is a Title Review Important in a Real Estate Transaction?

Law Offices of David W. Wilcox  May 24, 2024

When buying, selling, or renting property, one critical but often overlooked component of the due diligence process is the title review. A title review involves examining the legal status of a property's title to ensure it's free of any defects, liens, encumbrances, or legal issues that could impair the buyer's ability to gain clear ownership. The significance of conducting a thorough title review can't be overstated, as it serves to protect all parties involved in the transaction from potential legal and financial ramifications.  

In Bradenton, Florida, Attorney Wilcox stands out as a knowledgeable resource in real estate law, bringing nearly four decades of experience to the table. For those navigating property transactions, zoning laws, and real estate litigation in Florida, Attorney Wilcox's unique approach involves a blend of personalized attention and an unmatched depth of insight, offering each client tailored advice and robust support for their specific needs.  

What Is a Title Review?

A title review in Florida involves a thorough examination of the public records associated with a property to verify the seller's legal right to transfer ownership and to identify any claims, liens, defects, or burdens on the property. This process includes checking for unpaid taxes, outstanding mortgages, judgments, and easements that could affect your rights as a new owner. The goal is to ensure that you receive a "clear title," free from legal issues that could jeopardize your investment.  

A title review serves as a shield against potential legal issues that could arise from undisclosed liens, disputes over property boundaries, or claims of adverse possession by neighbors. It confirms that the seller has the right to sell the property and that the buyer is getting what they’re paying for without any attached liabilities. Always engage a professional to conduct this review early in the buying process to address any issues before closing. 

The Process of a Title Review

Conducting a title review typically involves hiring a real estate attorney who can confirm that every aspect of the property’s title is scrutinized for potential problems. This includes checking for any liens, encumbrances, or defects that could affect the buyer's ownership. 

The title review process includes the following steps:  

  • Title search: An examination of public records to trace the history of ownership of the property, identify any changes in ownership, and reveal any liens or encumbrances.  

  • Review of public records: This includes deeds, court records, property and name indexes, and other documents to identify any legal actions or claims against the property.  

  • Analysis of findings: Evaluating the information uncovered during the title search and public records review to identify any potential title defects or issues.  

  • Title insurance: Based on the findings, a title insurance policy may be issued to protect the buyer (and lender, if applicable) from any future challenges to the property’s title.  

Risks If There Is No Title Review

Skipping a title review can lead to numerous risks, including the possibility of buying a property that cannot be lawfully sold, inheriting debts attached to the property, or encountering legal disputes over property boundaries. These risks can turn what should be a dream home into a legal and financial nightmare. 

Omitting a title review can lead to several potential issues, including:  

  • Legal disputes: Claims from third parties alleging ownership rights or interests in the property.  

  • Financial liabilities: Existing liens or encumbrances on the property that could transfer to the new owner, such as unpaid mortgages, property taxes, or contractor fees.  

  • Encumbrances: Restrictions or covenants that limit how the property can be used or developed.  

  • Title defects: Errors in previous deeds, undisclosed heirs, or fraud that could invalidate the seller’s ownership.  

Each of these issues can result in costly and time-consuming legal battles, financial loss, or, in the worst-case scenario, loss of the property itself.  

Understanding the Role of a Real Estate Attorney

In Florida, real estate transactions don't require the involvement of an attorney, but hiring one comes highly recommended for peace of mind and legal protection.

Real estate attorneys are instrumental in closing transactions smoothly. They review all closing documents for accuracy and compliance with state laws, resolving any title issues before closing, and providing representation should any disputes arise post-closing. 

A real estate attorney like Attorney Wilcox can provide invaluable advice on addressing defects or issues found during inspections, review and suggest modifications to standardized contract forms, and negotiate effectively on your behalf. 

FAQs on Title Review in Florida Real Estate Transactions

What are the common title issues unique to Florida properties?

Due to Florida's history, geography, and real estate development patterns, some title issues are relatively common, including:  

  • Boundary disputes: Often due to incorrect or outdated property descriptions. 

  • Easements: Particularly for beach access or utility lines that may not be well-documented.  

  • Sinkhole claims: Previously undisclosed sinkhole activity can be a significant concern.  

  • Claims from heirs: Especially in cases where properties have been passed down through generations without formal probate.  

Given these unique challenges, a detailed title review by a Florida-experienced attorney is indispensable.    

How long does a title review take in Florida? 

The duration of a title review in Florida can vary based on the complexity of the property's history and the efficiency of the county's record-keeping system. Typically, a straightforward title review can be completed within a few days to a week. However, if issues arise, such as tracking down old records or resolving discovered claims, the process can take longer. Allow ample time for a thorough title review when planning your closing timeline to avoid unnecessary delays.  

What should I do if a title review uncovers issues with the property?

If a title review reveals issues, it doesn't necessarily mean the deal should be abandoned. Depending on the nature of the problem, there are several steps you can take:  

  • Negotiate with the seller to resolve the issues before closing, possibly by clearing the liens or addressing the defects.  

  • Request a price reduction to compensate for the cost of resolving these issues post-purchase.  

  • Walk away from the transaction if the issues are too significant or costly to resolve.    

Work closely with your real estate attorney to understand the implications of any discovered issues and explore all available options for resolution.  

The Value of Legal Support in Conducting a Title Review

Real estate transactions necessitate knowledgeable representation that can guide buyers, sellers, and renters through the process with confidence. Attorney Wilcox, serving Bradenton, Manatee County, and Sarasota County, emphasizes the importance of legal support in title reviews to protect what matters most to his clients. For individuals and families navigating the purchase, sale, or rental of property in Florida, understanding the significance of a title review and enlisting the help of a seasoned real estate attorney like Attorney Wilcox is crucial.  

Reach Out to Attorney Wilcox

If you need guidance or representation for a title review or any other aspect of a real estate transaction in Florida, contact the Law Offices of David W. Wilcox. With a commitment to excellence and a deep understanding of real estate law, Attorney Wilcox is ready to assist you in facing the legal system and protecting your investment.