Real Estate Litigation
Transactions and Title
Defects include unreleased mortgages, judgment liens, breaks in the chain of conveyance, defective acknowledgments, undisclosed easements, and boundary discrepancies. Some are curable and others require litigation.
Defects discovered before closing may permit termination.
Alternative Names:
Cloud on Title, Title Cloud
Why it Matters?
Whether a defect is curable determines the transaction's path, since an unreleased satisfied mortgage is a paperwork problem while a competing ownership claim requires quiet title litigation that closing cannot accommodate. Title commitments identify defects before closing, which is when they are cheapest to resolve. Defects discovered after closing shift the analysis to the title policy and the deed warranties.
Frequently Confused with
Related terms
Frequently asked questions
What determines whether a defect stops a closing?
What happens with defects found after closing?
