"The seller has assured me the title is clear."
This homebuyer should be thankful that his mortgage lender ordered title insurance. The transaction should have closed before the end of December and here we are in late January, hoping to close by month end. What happened? An unforseen title issue.
Our seller is the executrix of her father's estate. We'll call her father, Edward Smith. Mr. Smith was married to Mary Doe. The house and land we are attempting to convey and insure was Mary's family home. Her parents, John and Nancy Smith, purchased it when Mary was a little girl. Mary and her two sisters and three brothers grew up in that house. Each one in their own time, got married and moved on, all except Mary. Mary stayed at home, caring for her father after her mother's death.
John, her father, amended his will, giving Mary the right to purchase the family home for $7000 upon his death. If she did not wish to purchase it, the ownership would go to her siblings to share and share alike.
John Smith died. Mary did not follow the instructions in the Last Will and Testament. She did not purchase the property and this is where the critical error takes place. Mary went to the justice of the peace and had a new deed prepared. The justice of the peace was not well trained and prepared a crappy deed.
The Grantor section read: John Smith, deceased, and Mary Smith. The Grantee was Mary Smith. Mary had no right to execute a deed on her deceased father's behalf and there was no accounting for the interests of her siblings.
Mary stayed on in the house and then married Edward. They hired an attorney and deeded the property in both of their names as husband and wife, tenants by entireties. They had one child, a daughter, and raised her in the house. Mary died, then Edward, and now their daughter is selling the property. It's a burden to her and she would like to close as soon as possible.
When we raised the issue of the flawed conveyance from her grandfather to her mother, she was surprised but understood. Her aunts and uncles were now deceased and though it was a job, she thought she could find all of her cousins. Thankfully, this is a family that stayed reasonably in touch. One of her cousins lives in China but was coming home over the holidays and so was able to sign the deed right away. There are about ten grandchildren, all thank goodness are still living, who must sign the deed. All have agreed to simply quit claim their interests over to Edward's estate. We're just in a holding pattern while the deed circulates all over the country for signature. Well, actually two deeds. Her attorney drew up two deeds to make it go a little faster and that was a good idea but it does still take time.
This title story will have a happy ending. We'll be able to insure title for our homeowner and lender and there was no litigation necessary. It could have been a messy situation, but these folks were lucky.
Just because a property has been owned by one family successively over generations does not mean it has a clear title. Be careful and have an expert examine and insure any real estate purchase.