What Is a Title Contingency in Illinois Real Estate?
Buying a house is a significant decision. As such, there are numerous tools that you and your attorney can use to protect yourself if something goes wrong during the buying process. To take the necessary precautions, you would include contingencies in your Agreement of Sale. A contingency is a condition that must be met before you can complete a purchase. There are many different types of contingencies that you and your attorney may choose to include in your agreement, one of which is a title contingency.
What Is a Title?
A “title” in real estate refers to a property’s record of ownership. Not only does it contain details regarding past owners, but it will also include liens or judgments made against that property. In most cases, before you buy a new home, your attorney will examine the property’s title to make sure it can be properly transferred to you.
Sometimes, a property’s title may be problematic. For example, if a previous owner struggled financially, a creditor may have claimed a piece of the property to gain what a previous owner owes them. If this issue surfaces when you are considering buying a house, a title contingency will allow you to back out of the sale if any problems regarding the property’s title cannot be solved.
Common Home Title Issues
Problematic house titles are more common than you might imagine. Many title companies claim that more than a third of all real estate transactions have title issues that are extremely difficult to sort out. For example, “past deeds, wills, trusts, divorce decrees, bankruptcy filings, court judgments, and tax records that may be defective or outstanding” from at least the past 50 years could prevent a clean transfer of ownership.
Be prepared to deal with any unrecorded title defects. Some examples include forgery, signing under aliases, duress, erroneous legal descriptions, right of access eradicated by foreclosure on a neighboring land, and more. You and your attorney can search for unrecorded title defects by examining public documents at a county recorder or clerk’s office.
Contact a Will County Real Estate Lawyer
It is vital to take precautions when you are purchasing a new home. To do so, you and your attorney will decide on the appropriate contingencies for your Agreement of Purchase. At the Law Offices of Tedone & Morton, P.C., we use our many years of experience in assisting clients safely and legally claim the deed for their new home to help them with their next major real estate purchase. To learn more and schedule your free consultation with a diligent Joliet, IL real estate attorney, call us today at 815-666-1285.
Sources:
https://www.forbes.com/sites/taramastroeni/2018/08/27/the-five-most-common-home-buying-contingencies-explained/#5663bf4d3786
https://www.investopedia.com/articles/credit-loans-mortgages/090816/it-bad-have-lien-your-house.asp#:~:text=Is%20a%20Lien%3F-,A%20lien%20is%20a%20legal%20right%20or%20claim%20against%20a,be%20both%20voluntary%20and%20involuntary.
https://www.washingtonpost.com/news/where-we-live/wp/2016/06/20/these-common-title-problems-can-snag-your-home-closing/
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