This is the next post in our series on retaining an attorney to handle Hartford, Connecticut real estate transactions. Our last article discussed retaining counsel to draft contracts for buying or selling property. It is important that you retain a firm with experience in such matters, as it can improve the chances that your contract will include the protections you need. In this article we will discuss another important topic – retaining counsel to perform a title search. If you are in need of assistance with a residential or commercial real estate transaction then contact our office today to speak with a lawyer.
Connecticut requires that attorneys perform a title search to ensure that a purchaser has “clean” title of the property
A “title search” is vital to the acquisition of property in the state of Connecticut. This is a process by which an attorney extensively researches various public records to ensure that all liens or encumbrances against a property are extinguished before ownership is transferred to the buyer. Such encumbrances can include mortgages, various liens, judgments, and more. A title search is typically required to obtain title insurance. Also, rarely will a lender offer a mortgage on a property unless a title search is performed. This is due to the fact that a lender will not be able to obtain priority over another lien holder if any encumbrances are in place. If the search does show that there are encumbrances against the property then the law firm handling the property closing will be charged with ensuring that they are paid out of the sale proceeds.
The foregoing concepts are best explained by way of example. Suppose Jill Buyer puts in an offer to buy a Connecticut single family residence. She gets pre-approved for a mortgage and puts in an offer. Her offer is accepted. She will now begin the process of going through inspections, finalizing her mortgage application, etc. While this process is ongoing, the title search finds a lien against the property that the seller did not know existed. The lien is in the amount of $5,000. The seller could either pay the lien directly, before closing, or have the lien satisfied out of the loan proceeds. If the seller chooses the latter, then the attorney handling the closing would use the purchase funds to a) pay off any existing mortgages which the seller has, b) pay the lien, c) pay any realtor commissions and legal fees, and d) distribute the remaining proceeds to the seller. The buyer would then receive a “clean” title to the property. While this example may seem straightforward, it is important to understand that performing a complete search can be complicated. It is important that the attorney leave no stone unturned or else you run the risk of a title blemish going undiscovered.
It is important to retain a Hartford attorney who is experienced in performing title searches
If you are entering in a real estate transaction then it is important to retain a lawyer who is experienced in performing title searches. It only takes one missed public record for a lien or judgment to slip through. This can result in the seller acquiring property with an encumbrance on it. Such an event can often result in litigation between the buyer, the seller, and possibly the lender. By hiring a firm experienced in handling such matters, you help to increase the chance that your title search is performed correctly.
If you need assistance with a title search then contact our office to speak with a Hartford real estate lawyer. We understand the importance of property transactions and we will work to ensure that your matter is handled properly. Our office prides itself on providing quality service and we look forward to being of assistance. Contact us online or by telephone today. We also serve the areas of Wethersfield, New Britain, Rocky Hill, West and East Hartford, Bristol, Glastonbury, and Manchester, as well as the Middlesex County cities of Middletown and Cromwell.