Before you can go to settlement you have to have a title report done which will reveal loans on the property (including loans that were paid off but have not had a release recorded), law suits, liens or judgments that can attach to the property, any Rights of Way, Easements, or Covenants that can affect a property, and who owns the property (ex. you may think you do but some heir from 50 years ago legally owns a percentage because the title to the land was never deeded properly).
There can be some pretty amazing things that an abstractor can find. For instance here are a couple from Brad Whidden, an abstractor for almost 15 years.
Brad says, “In the 1800’s in Frederick there is a deed where they declared a farmer insane and took away his farm and deeded it to someone else. Why? Because someone walked by his barn and saw him [doing the dirty] with one of his pigs. They described it in detail on the deed.”
Another one Brad mentioned is, “A few years ago this [lady] in Montgomery County got a few people on board who owned property and tried to declare that due to the failures of George Bush and the government these properties were no longer part of the United States but they were now their own separate country and were therefore not subject to the US Dollar. They actually recorded deeds saying this. Then they stopped paying the taxes and mortgages on it. Needless to say, that did not pan out for them.”
As you can see, there could be some crazy things jump out of the woodwork when you have a title run on the property you or your clients plan to purchase! In the end though, that’s why you need to have the title report run and even better that’s why you buy title insurance! Also, choose a settlement company, such as Lawyers Signature Settlements, that can provide you with the best service to clear up these types of issues before you go to the settlement table.