What title defects can void a contract when attempting to buy real estate?

Attorney answers (3)

1. Licensed in CA

   

   David S Hoffman

   San Jose Real Estate Attorney

   Contributor Level 13

   3

   Lawyers agree

   Answered April 30, 2012 21:04. Normally, in a residential purchase contract, the buyer has the right to review and approve, or review and disapprove, a preliminary title report. The "prelim" should identify all liens and encumbrances recorded against the property. Theoretically, in a normal transaction, the liens should be paid off in escrow. The encumbrances, such as easements, remain on the property, and you need to determine whether you are OK with easements. Some easements you need, (such as utility, ingress/egress), but some easements may give rights to other users. So you need to ask the title officer to identify, on a title map, where the easements may be, (their location may be important if you have plans to remodel or expand...)
   
   Most real estate agents don't understand how to explain a prelim... your best bet is to schedule time with a real estate attorney, or better yet (because it is free), with the title officer.
   
   Good luck.

   • Mark as helpful
   • Flag
2. Licensed in CA

   

   Frank Chen

   San Marino Real Estate Attorney

   Contributor Level 20

   3

   Lawyers agree

   Answered May 01, 2012 10:54. Attorney Hoffman is correct. If you are using the California Association of Realtors form for the purchase and sale agreement, there will be a time period for you to approve certain reports. You will obtain a Preliminary Report from the title company. If there are any defects in title, AND you are withing the time period set forth in the purchase agreement, you should be able to cancel the transaction.

   Frank W. Chen is licensed to practice law in the State of California. The information presented here is general in... moreFrank W. Chen is licensed to practice law in the State of California. The information presented here is general in nature and is not intended, nor should be construed, as legal advice. This posting does not create any attorney-client relationship with the author. For specific advice about your particular situation, consult your own attorney. less

   • Mark as helpful
   • Flag
3. Licensed in CA

   

   Nicholas Spirtos

   Santa Monica Real Estate Attorney

   Contributor Level 19

   3

   Lawyers agree

   Answered May 01, 2012 12:03. Title defects would generally be contained within a title report, and some could result in voiding sales of real property. Such defects might not be known to the seller, so they would not typically be specified in the purchase and sale agreement.

   • Mark as helpful
   • Flag