Title Search Defect

brad126
Contributions:1

I am buying a townhouse here in downtown Ft. Lauderdale, and was set to close next Friday. Was a bank owned property. Contract, Down payment, financing, seller contingencies, inspections, appraisals, etc. were all in place and complete. I had to use the banks title company. They just ran the title search today and relayed to my realtor and attorney that the title has a "cloud" on it. Apparently there is a unit either next door or behind my unit on the other street that is in foreclosure, and THEY had a clerical mistake and used MY properties legal description in their foreclosure proceedings, which places their mortgage liens on my property. I was so close to closing and had everything in place for the move, etc. They just killed me with this news. A real estate attorney I know said best case scenario they can go through the motions of getting the bank to correct this properties description and remove the liens, which can take time. Worst case scenario is that property has to go to re-foreclosure, which obviously can take months and months. Is the info I'm receiving about scenerios correct? Something does not seem correct. Why should I suffer for some idiot neighbors clerical screw up? Have you seen this before? Is there anything I can do to speed this process up and make sure their doing what they should be doing in my interest?

Flag content

June 03 2009 - US

E-mail Share RSS

Answers (1)

Lindsey M. Bishop
- 4.8/5.0
- (11 reviews)
Contributions:379

Sadly I saw something like this happen to a client I closed earlier this year in Port St. Lucie.

Just curious - what title company did the bank force you to use?

Call the title company daily - ask them what the process is and ask daily where they are in the process. Try to control the situation the best you can and be involved the most you can.

FL right now is slammed with foreclosures. A Clerical error like this can take some time - especially if you have to go back through the courts and re-file the proper property under foreclosure and release the property and liens of the address you are buying. This should have been caught a bit sooner though in my opinion - but it is what it is now. I will say my clerical error was fixed up in 1 week - the title company was really pushed though by myself, the realtor, and the homebuyer. 3 to 4 calls daily asking what we could do to help speed the process.

When does the purchase contract expire? Did you approach the title company and/or seller to compensate you for rate lock extensions or contract extensions?

Good Luck - I know this is a pain, but try and stay positive!

Lindsey :-)