Master the Real Estate License Exams by Peterson's

Author:Peterson's
Language: eng
Format: epub
ISBN: 9780768930412
Publisher: Peterson's, a Nelnet Company
Published: 2010-10-01T00:00:00+00:00

NOTE

Find out which system for titles your state uses.

Clearing the Title

In the process of providing a marketable title, the seller must clear the title of any liens and other encumbrances that impact the title. The mortgage is a lien on the title that is typically paid off at the time of the closing from the proceeds of the sale. Other liens may include unpaid taxes. These may be paid off from the proceeds at the time of the closing, or before the closing, if the seller is able.

In addition to liens, a title may be encumbered by easements and deed restrictions. If the title search finds any, they are reviewed by the buyer and the buyer’s attorney before closing and must be resolved with the seller. Some easements and restrictions “run with the land,” and the lender’s title policy will provide that they will not cause a forfeiture of title. Usually, buyers are willing to buy property with easements if the easement will not interfere with their use of the property, and if it does not affect the marketability of title.

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