Title Talk

A deed is a deed. Right?

You’re buying a new home and there is such excitement all around. What kind of floors should you put in, what color should the living room be, should we get a new fence? While you are busy planning making your house a home, we are busy making sure the property is being conveyed (sold or transferred) to you properly.At the closing, when the deed is finally signed, it’s very exciting, but what rights does your deed give you? There are many different types of deeds, with many different meanings, which provide different degrees of ownership and property rights. The most commonly used deeds when buying or selling a home are warranty deeds, which transfer the property itself (in comparison quitclaim deeds simply transfer whatever interest in the property the seller).

In Pennsylvania, there are two types of warranty deeds, special and general. The special warranty deed contains a warranty or promise from the grantor (the person selling or transferring the property) to the grantee (you the buyer) against all claims to the title of the property from the grantor or anyone making a claim based on the grantor’s prior ownership.

The general warranty deed provides a broader guarantee than the special warranty deed. When a grantor (seller) gives a general warranty deed, the grantor is promising that the grantor will defend the title against anyone and everyone who has a claim of title to the property.

At Terra Abstract, we have experience with the various deed forms in all the states we serve. Regardless of what type of deed you choose, we at Terra Abstract will make sure everything is done properly and will be here to answer your questions.

Are Clouds on Title Stressing You Out?

When purchasing distressed properties, clouds on title can be a major headache and a costly time waster. This can cause real property sales to be postponed and even cancelled. There are many different factors that can lead to a so-called “cloud” on title (or title defect that interferes with a seller’s ability to transfer “clear” title to a property). A comprehensive property search will identify any title defects that cloud title. These issues can move in like storm clouds and cause unwanted delays in closing.

Although it may be possible to close on a property subject to certain clouds on title, these issues could potentially cause problems later when the new owner tries to sell the property. This is particularly concerning for investors who plan on turning the property over quickly. These issues tend to be more common when purchasing distressed properties. It is best to handle these issues up front rather than close on the property with the intention of clearing those issues later.

Common issues that create a cloud on title are mortgages that were paid but not satisfied of record, delinquent taxes, judgments, and potential estate issues such as discovery of undisclosed heirs. In the first part of a three part series, we will shed some light on these types of clouds.

Part 1 – Unsatisfied Mortgages
It is not uncommon for a searcher to find multiple mortgages encumbering a property. In many cases, the mortgage was paid but a satisfaction was not recorded. When this happens, trying to track down the proof of payment and unrecorded release documents can prove to be very difficult. Sellers often do not have the necessary documents at their disposal. The originating lender of the mortgage, or subsequent assignee, may not be in business any longer. These release documents must be obtained and recorded in order to remove the cloud on title. This process can take time and money. In the case of distressed properties, sellers are unlikely able to accomplish this on their own. Buyers should anticipate hiring a title company with the experience and expertise required to handle such issues.

Our team at Terra Abstract has the requisite skills needed to assist investors, banks, and homebuyers in clearing the clouds on title that prevent them from moving forward with purchasing a property.

The Wedding is Over. Now What?

So you’ve gotten married and are now making two separate lives one. This is an exciting time, but with it comes decisions. Where shall we live? Should we buy a new home? Who should be the titled owner of the property? Perhaps one of you came into the marriage already owning a house and you’ve chosen to make that the marital home. Should my spouse be added to the deed? How can I best protect my family and home? In many states, there is a unique option available to married couples that you may want to consider.

When two or more people share ownership of real property it creates what is called a “concurrent estate”. There are several forms of this concurrent estate that can be chosen and established through specific language in your deed. One form in particular is available only to married couples. It is called a tenancy by the entirety. For a property to be held in this manner both spouses must be on the deed. Under this form of ownership the married couple as a whole is seen to own the property rather than the individuals holding a specific interest.

There can be benefits to tenancy by the entirety ownership. For example, in Pennsylvania, if your spouse were to be sued and a judgment entered against them, your home would be protected because creditors of one spouse cannot pursue real estate owned by tenants by the entirety. If you and your spouse live in New Jersey and own your home as tenants by the entirety, the property will pass automatically to your spouse upon your death without the need for probate or a new deed.

While the types of ownership available may vary from state to state, Terra Abstract has the knowledge and experience necessary to implement your choice of ownership to the best fit your unique circumstances in this new stage of your life.