Real Estate Transaction: How A Title Dispute Can Delay It

Like that of the rest of the country, Washington State’s housing market experienced an unprecedented surge in 2020. The rapid growth and activity of the housing market continues in 2022.

Fueling the flurry of movement are factors such as the increase in remote work environment, the desire to move to scenic rural areas, and record-low interest rates. Whatever the source, the result is a drop in inventory and a rise in demand. Real estate buyers have been scrambling to quickly submit the most attractive offer; sellers face an inundation of competing offers in short periods of time. With that backdrop, parties to a real estate transaction are typically quite anxious about moving from signing the contract to handing off the keys quickly and efficiently.

But what happens if there is a title dispute? How can a title dispute impact the real estate transaction?

In this article, we’ll talk about:

1. What “title” is;
2. What common title disputes are;
3. How to resolve title disputes;
4. How a real estate title dispute can delay the transaction; and
5. What happens to a real estate transaction when there’s a title dispute.

Throughout the article, we’ll also help you understand the role of an experienced real estate attorney, including how they can help you resolve your title dispute.

What Is “Title” and Why Is It Important?

“Title” refers to the validity and record of current and past ownership in real estate. Having ownership in property includes the right to:

1. Live on the property,
2. Use the property as collateral for a loan or mortgage,
3. Exclude others from entering the property, and
4. Sell or lease out the property.

With this in mind, the title search step in a real estate transaction functions to uncover and check whether the seller possesses the legal right to sell the property. Further, the title search reveals what type of ownership they have and whether others also have legal rights to the property.

In many cases, title searches bring to light unremarkable details as far as the buyer and seller are concerned. In other cases, however, the title search unveils issues that directly impact the transaction. These title issues may lead to title disputes that delay the real estate transaction.

What Are Examples of Title Disputes?

Title disputes are disputes affecting the ownership or the boundary line of the real estate. Title disputes include, but are not limited to:

1. Easements—someone else has or asserts a right to use part of the property;
2. Unreleased mortgage—the property is collateral for a mortgage;
3. Lien—the current or a prior property owner owes someone money;
4. Boundary disputes—there’s a dispute about the actual boundaries of the property;
5. Public records errors—typographical errors in street names or numbers; and
6. Invalid or illegal deeds—prior deed signed by a minor or by someone under duress.

As you can see from these examples, title disputes can involve a variety of questions and concerns about the title to the real estate.

How to Resolve a Title Dispute

Depending on the specific circumstances, resolving a real estate title dispute can be as simple as a properly worded email or letter. In other situations, resolving the title dispute may require you or your lawyer to take additional actions, such as:

1. Executing a quit claim deed,
2. Signing an affidavit,
3. Filing a corrected deed,
4. Recording a release of mortgage or lien, or
5. Filing a quiet title action.

Having a skillful real estate lawyer on your side no matter the real estate dispute reason can mark the difference between closing the deal and losing the deal.

How Can a Real Estate Title Dispute Delay the Real Estate Transaction?

The length of the delay of the real estate transaction largely depends on the reason for the delay.

In some cases, resolving a real estate title dispute may involve using a quit claim deed to transfer title of the property from one party to another. For example, let’s say that the title search uncovers that another person has an interest in the property. If this other person is a former spouse, then resolving the title dispute may simply involve executing a quit claim deed. A quit claim deed is a way of transferring an interest in real property quickly and efficiently. In this scenario, the time required to resolve the title dispute may be only a week, possibly less.

Not all situations may reach a successful outcome by simply signing a document, however. If there is an unsatisfied mortgage on the property or another person who holds a competing interest in the property, then the solution can be more complex.

Regardless of how complex or straightforward a title dispute may seem on the surface, contacting an experienced real estate attorney can set you up for success. If the parties file or sign the wrong document, this can potentially worsen the issue. Likewise, leaving language out or including certain language can create unintended consequences. Our real estate lawyers know what to look for and how to resolve almost any title dispute.

What Happens to a Real Estate Transaction When There’s a Title Dispute?

The real estate transaction is in limbo while the title dispute is ongoing. Parties can ask for an extension of the closing date to give everyone more time to resolve the title dispute. Meanwhile, what happens to the real estate transaction largely depends on the terms of the contract. If the contract allows for it, the buyer may be able to look and submit offers for other houses. Given that the survival of the deal depends on the resolution of the title dispute, it’s important for parties to have the assistance of an effective title dispute attorney.

How Our Real Estate Attorneys Can Help You Resolve Your Title Dispute

With our combined 50 years of experience effectively assisting clients like you, the lawyers at Bolan Law Group. are the ones you need when there’s a real estate title dispute. We understand how essential it is for the title dispute to be resolved effectively and efficiently. We practice law with integrity at the forefront, pledging to recommend the simplest, most effective solution to the title dispute. Our clients’ best interests are our #1 priority, and we will never sell you on anything that you don’t require. Give us a call today or contact us online so that we can help you resolve your real estate title dispute.