Do you know everything you need to know about how to clear title?
When it comes to the title process, what should agents know about the abstract and title opinion?
The abstract is the history of a property that must go back at least 43 years (as mandated by state law). Some properties’ histories go back further if their abstract has been kept in good condition or no one has lost it. If a buyer writes an offer for a property you represent, you need to know where the abstract is and where it needs to go so the buyer’s attorney can give a title opinion based on it. Then, you need to be able to clear title.
I find that we’re struggling more and more as an industry to know what it means to clear title. Agents haven’t gotten the training they need to do so, in my opinion. What this boils down to is a change in the industry. We agents are able to delegate more tasks, but that doesn’t mean we’re able to talk to consumers about the title process and why closings may be delayed.
There will always be clouds on a title. Mortgages and property taxes, for instance, are clouds. Additionally, the seller may have an IRS lien. If they have a common name (Murphy, Anderson, etc.), there may be a lien against someone else with the same name that needs to be cleared. Oftentimes, this just involves getting an affidavit drawn up.
At the end of the day, we need to communicate with our sellers the best we can about how the title needs to be cleared. All of us can do a better job with this, which is why I always advise doing your research in terms of what a title opinion looks like and what needs to happen to clear that title, whether that means drawing up a name affidavit, getting the seller released from a previous mortgage company, or something along those lines.
In our office, we train our agents diligently on this topic because it’s that important. If you have questions about the title process or how to communicate with your clients about it, feel free to call or email me anytime. I’d love to speak with you.
