Lethbridge General Practice Blog

Clearing a title of defects before buying or selling

| Jun 25, 2021 | Real Estate |

The housing market in Alberta has been a bit of a rollercoaster. If you are selling, it can be a more fun and exciting ride than if you are buying. That said, every residential or recreational home transaction can be a little scary. There is a lot of money on the line and countless details to address before closing.

One issue that could create an unexpected obstacle is a problem with the property title.

Potential issues with a title

In a typical home-buying transaction, the title ownership transfers from the seller to the buyer. However, when there are issues with the title, this process can be delayed or cancelled altogether.

Potential issues that can arise regarding titles include:

  • Tax liens
  • Builders’ liens
  • Fraud
  • Hidden deficiencies
  • Boundary disputes
  • Easements
  • Other owners with claims to the property

These defects or clouds can prevent a seller from having the right to transfer ownership to someone else. 

Some examples include a person trying to sell property while having outstanding taxes or selling a home without the approval of other owners. This could be the case when owners divorce or are estranged. 

Clearing clouds on titles

If there is a cloud on a title, current holders would be wise to address the matter upon discovering it. Solutions could be as straightforward as paying off a balanced owed to builders or others who placed a lien against the property. Other options can include securing a quitclaim deed or contesting a false claim.

Clearing a cloud could be more complicated and time-consuming than people might expect, which is why it can be crucial to speak with a lawyer about clouds on a title prior to buying or selling property.

Protecting against clouded titles

You can minimize the risk of taking on a defective title by conducting a title search and navigating the proper legal channels whenever you buy or sell a property. If you are a buyer, you may well want to get title insurance to protect you from any financial damages caused by a defective title. 

When buying or selling a home, the last thing people need is a legal hiccup that could compromise the transaction. Taking title issues seriously can help you avoid this obstacle, make the process go more smoothly and give parties peace of mind.

When you need legal help, we are here for you.

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