In Florida, a legal conflict between the buyer, seller and a third party with a vested interest in the property can quickly derail the closing in a real estate transaction.
These third parties can include contractors who have performed services to improve the property prior to sale and have filed a lien in the public records to ensure they get paid for their work. Until these title issues are resolved, the closing cannot occur due to the seller not being able to convey “marketable title.”
Here are a few examples of common title issues that can arise during a title search prior to closing.
- Florida Statute Chapter 695 Record of Conveyances of Real Estate protects people from schemes and silent deals when it comes to the ownership of real estate. For example, let’s say a contractor is in the process of replacing hardwood floors in the home. If the deal closes, whose responsibility is it to pay the contractor? The seller who hired him or the buyer who is enjoying the new floors? In accordance with Florida’s recording law, the title to the home is not marketable if the contractor filed a notice in the public records that he performed the services to improve the property. The contractor in this case has the superior interest, which would likely prevent the real estate transaction from closing.
- You might be surprised how often two individuals claim to have deeds or titles to the same piece of real estate. In Florida, we have what is referred to as the “common source of title” legal doctrine. Here, there is a conflict when two parties both claim title to the real estate from a single source. Under the law, the party that can provide evidence of “better” title from that single source will be given legal title to the property.
- When a buyer decides to purchase real estate in Florida, and takes title to that real estate knowing that there are prior claims on that property, then the buyer accepts full responsibility to those claims. For example, there may be a covenant within the deed itself that stipulates that the buyer assumes a specific debt against the land as part of the sale and purchase price. That covenant will legally make the buyer liable for that debt. The buyer does not have to sign any document agreeing to “accept the debt as their own,” by simply paying the purchase price and taking the deed, the buyer has accepted responsibility.
Attorneys’ Closing Services (ACS) assists everyone from the sole practitioner to fully-staffed offices. We offer full service processing for commercial and residential attorney title agents. Whether your office needs assistance with full or partial closing processing services, ACS stands ready to assist you at a moment’s notice.
ACS is owned and operated by Ronald J. Conte and David H. Trevett, practicing attorneys who have more than 50 years of combined experience in the fields of law and real estate. We would be honored to work with you on any and all of your real estate closings. To learn more, click here or call us today at 407-270-8855 to see how we can help you.
Source:
http://www.abajournal.com/blawg/About_Florida_Law
