In Massachusetts real estate transactions, a seller should be able to transfer good, clear, and marketable title to a buyer. Clear and marketable title means that there are no defects, encumbrances, liens, or the possibility of litigation associated with the property. Typically, Boston banks will only give you a mortgage if the property's title is clear and marketable. At Pulgini & Norton, our knowledgeable real estate lawyers can help Boston residents make sure that the property they are buying has clear and marketable title. We can represent your interests throughout the transaction.
Clear and Marketable TitleTitle is clear and marketable when the chain of ownership to a piece of property shows that a piece of real estate is free from defects. This means the property can be marketed for sale without additional effort by a seller or buyer. An insurable title, by contrast, may have a known defect in the chain of title. In these situations, however, a title insurance company has agreed to provide insurance against any defects that are discovered and that could affect your ownership or the property's value.
Generally if there is a defect in title, and the property does not have a valid title insurance policy currently in place, the defect must be cured or fixed. This can be expensive and time-consuming. It can be a mistake to accept insurable title rather than demand clear and marketable title. Even if defects do not threaten the property while the buyer owns it, the next buyer may demand a marketable title.
Typically, a purchase and sale agreement will set out the framework and precise terms of the deal, including the nature of the title being transferred and the deed. The agreement will spell out that the seller transfers the deed to the buyer in exchange for a specific amount of consideration. The deed is then recorded, and the buyer will become the owner of the property. After a property deed is recorded, any problems with the title, such as liens or other ownership claims, will run with the land. If your transaction is not conducted properly, any issues that are created in the transaction can present problems for someone trying to buy your home from you later.
In order to protect your interests, your attorney should make sure that the purchase and sale agreement specifies the seller must transfer the property with "good, clear, and marketable title." This involves a comprehensive title search in the public records of the county where a property is located. The search must go back at least 50 years, and it must ensure that the title always passed appropriately from owner to owner.
To pass the property appropriately, a seller's attorney prepares a deed with a correct description of the land to be signed and delivered to the buyer at closing. The seller's attorney must also help obtain any information necessary to pay off existing mortgage loans so that the title is clear. It is often a sound decision to purchase title insurance.
Consult a Boston Lawyer for Advice on a Property TransactionEven if it is unlikely that you will encounter problems with the title to your prospective home, you should consult an experienced attorney to make sure that your family's financial situation is not devastated in the event that a problem does arise. A buyer may bear the brunt of the financial consequences of a clouded title. The property transactions attorneys at Pulgini & Norton can guide individuals in Boston through home sales and other real estate matters. We also represent clients in Andover, Hyde Park, and New Bedford, among other communities. Call us at 781-843-2200 or contact us via our online form to arrange a meeting.