When buying property, most buyers conduct title searches and obtain title insurance protecting them from later defects in title searches. Here are some key considerations with regards to the title searches and title insurance:
Title Search - The Concept of Notice
A title search is conducted in order to put the potential buyer on notice of any deficiencies in the title of the property. A title search serves to see if the premise is encumbered by a mortgage, lien, restriction, right of use, partial ownership, etc. It serves to tell the buyer what interest he is really buying and what liabilities he may be subjecting himself to.
Notice is considered given and appropriate in Florida in 3 different ways: 1. constructive notice, 2. actual notice, and 3. implied notice. Actual notice comes from actually knowing the fact in question. Implied notice applies to a situation in which the party has a duty to make an inquiry regarding a fact in question and has the means of obtaining the acquiring knowledge of the fact. Constructive notice comes from the inference of knowledge and comes from the operation of the law - in short, from the recording statute.
So what do you need to look for in a title search or when litigating a dispute relating to your ownership of the property or of a liability? Look for irregularities in the formatting of legal documents, legal descriptions of the property, references in the mortgage of other mortgages or other properties, and, if possible, check every record related to the property and owners of the property. The courts will look at whether any mistake in the deficiencies are capable of being corrected easily in the document. If they are, then you will be deemed to have been on notice.
What is the practical aspect of this? Have the person who is conducting your title search check to see if there are any references to other properties on mortgage documents and try to see if you can request a search of every ownership interest the seller has. If you are buying from a bank, foreclosure or the like - this practically becomes an unrealistic situation. It is best to obtain a title insurance policy to cover you in case of litigation.
Title Insurance - Get the Largest Coverage
Some Tile Insurances provide different levels of Title Insurance Coverage. Some are made for lenders and will be necessary if you are applying for a mortgage, while others are intended for the homeowners who wish to have the insurance. The insurance policy serves to protect you in case there is a litigation or sort of dispute relating to your ownership and title in the property. Due to the current market circumstances, number of foreclosures and administrative nightmares that have been happening - it is strongly suggested and advised to take the highest insurance coverage available. While it may be a bit more expensive at the time of purchase, it can save you a lots of money down the road. The insurance coverage will last the duration of your ownership. Thus, you also need to know that you will not be covered by the seller's insurance.
If you have any questions or need legal assistance in the purchase or sale of a property, please call us! We are here to help and hope to have the pleasure of speaking with you! (239)963-6043
*This article is intended as general information and is not legal advice. It also does not create any Client-Attorney Privilege or relationship. Please call us so we can give you individualized help for your particular situation.