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  • Writer's pictureHeather Rose, Founder, Escrow Officer

Paving the Way to Seamless Closings: Mastering 5 Proactive Title Lien Skills for Realtors

Expert Strategies for Preemptive Title Management in Real Estate Transactions for Realtors


Hello, My Real Estate Lovelies! Today, we're diving into the realm of title speedbumps—the potential stumbling blocks that can derail/delay even the most promising of transactions. But fear not! With a proactive approach and a keen eye for detail, you can tackle these challenges head-on before they become a closing issue. So, grab your favorite beverage, settle in, and let's explore how to clear these title hurdles like seasoned pros.


Embarking on the investigative aspects of real estate listing, this title solutions guide promotes a proactive mindset and keen attention to detail to prevent possible closing delays, empowering you to take swift action before they become major hurdles.



 

You pull up to the property, grab the tools of your trade, and begin your assessment of the property. While you are taking your pictures, and filling out your forms, I want you to add a few extra steps, won't take a moment, but can save you countless wasted hours, days, weeks, years... yes. Years.



 

Solar Panel Title Liens: Ask Before Things Heat Up 


If you arrive at your listing appointment and notice shiny new solar panels, while they can be a fantastic addition to any home, their presence can sometimes come with hidden complexities, such as associated liens.


By proactively investigating the status of any solar panel installations and ensuring that any related liens are addressed upfront, we can pave the way for a smooth transaction that leaves everyone beaming. Most solar panel liens will need to be either paid off at closing or assigned and assumed by the buyer (buyer qualifications could apply).


PRO TIP: Have your seller contact the solar panel lien holder before or at the listing appointment for their requirements upon the sale of the property to release the lien on the title. Gathering the data ahead of time will be invaluable in not only pricing the home but in eliminating buyer funding issues as well.


Equity Lines Inquiry: Owed or Not Owed - Realtors Ask Those Questions 


Equity lines of credit are common financial instruments, but their existence can complicate matters when it comes to selling the property. Why? Often they were opened, never used and long forgotten, or long ago paid off but not actually closed and released, or a current lien the seller makes payments on monthly. These, just like mortgages, taxes, etc., have to be released at closing, thereby clearing title for the new owners. By asking the right questions early on and clarifying the status of any equity lines, we can eliminate potential surprises down the road and ensure a smooth closing.


PRO TIP: Ask if your seller ever had or currently has an Equity Line, if the answer is yes or maybe, have them begin looking for the company name and contact numbers, loan # numbers, or proof of payoff, letters from the lender stating the loan was paid in full.


Window, Pools, Lights in the Sky: Oh My!



Those efficient new windows are looking fabulous against the vinyl upgrade from 5 years back, that deliciously cool water of the new pool, the new roof still looking brand new, like the day it was put on a summer or two ago. Yes, the house has been updated over the last few years and is going to sell fast.


Great! But here’s the thing, are all those improvements already paid for, or is your seller making monthly payments?


Nine times out of ten if they are making payments there is a financing statement or the like recorded and will need to be either paid off or released from title. (Similar to Solar Panels)


By openly discussing any recent renovations with clients and ensuring that all necessary paperwork is in order, we can avoid tax-related headaches and maintain transparency throughout the transaction process.


PRO-TIP: If the seller is making payments for those items, get all the lien information, loan numbers, contact information, and conditions of sale, like the Solar Panels earlier.


Judgments and IRS Lien Troubles: Nowhere to Hide 


Judgments and Tax issues can cast a shadow over even the most straightforward transactions, but they don't have to be a deal-breaker. By proactively addressing any IRS concerns and working to resolve tax issues before they become a problem, we can keep the transaction on track and minimize stress for all parties involved.


PRO TIP: Has your client been ill for a long time, lost a job, must sell for financial reasons? Any of those could be a sign there may be underlying title liens. Some sellers outwardly look carefree when the title examination reveals financial troubles.


Inherited Property: Family Ties and Family Feuds


Inherited properties can present unique challenges, from unclear title status to potential family disputes. By approaching inherited properties with sensitivity and diligence, we can proactively address any title issues, clarify ownership rights, and ensure a smooth transition of ownership that honors the wishes of the deceased and protects the interests of all heirs.


PRO TIP: Gather copies of death certificates, names/addresses/contact information for any/all heirs, copies of wills, accounts, any liens the deceased may have been paying/not paying. A title search sometimes will require a family tree, getting the seller started at listing on getting that together will help keep the transaction smooth.


Conclusion: And there you have it, folks—the top five title issues that proactive realtors can resolve in advance to ensure smooth transactions and happy clients. With a proactive mindset, thorough investigation, and clear communication, you'll be well-equipped to navigate these title hurdles with confidence and finesse.


Here's to preemptive measures, successful closings, and many more transactions handled with expertise and care. Cheers to your continued success in the world of real estate!


PRO-TIP: Take one of the authorization forms your title and escrow closing agents use with you to your listing appointment, have the seller fill it out while doing the listing, going through all the information together, and BOOM.. you have already gathered the data your settlement agent needs to coordinate your closing.


We hope to see YOU at The Closing Table!

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