What Happens If a Title Problem Is Found Before Closing in Washington?
If a title problem is discovered before closing in a Washington real estate transaction, the issue typically must be resolved before the property can legally transfer to the buyer.
Title problems are usually discovered during the title company’s title search, which reviews public property records to verify that the seller has the legal right to transfer ownership.
If the title search finds a problem—such as a lien, ownership dispute, or recording error—the closing may be delayed until the issue is cleared.
Why Title Problems Must Be Resolved
When a buyer purchases a home, they expect to receive clear ownership of the property. If a title problem exists, another party could potentially claim rights to the property.
Because of this risk, title companies will usually not allow the transaction to close until the issue is resolved.
The goal of the title search is to ensure the buyer receives marketable title, meaning the ownership can be transferred without legal disputes.
Common Title Problems Found Before Closing
Several types of issues may appear during a title search.
Some of the most common include:
- unpaid property taxes
- contractor or mechanic’s liens
- unresolved mortgages
- judgment liens against the seller
- recording errors in property records
- boundary disputes
- ownership claims from unknown heirs
Many of these issues are administrative or financial problems that can be resolved before closing.
How Title Problems Are Usually Fixed
When a title issue is discovered, the title company works with the parties involved to clear the problem.
Common solutions include:
- paying off outstanding liens
- obtaining lien releases from creditors
- correcting public record errors
- filing legal documents to confirm ownership
Once the issue is resolved, the title company can proceed with closing.
When Title Issues Delay Closing
If the title problem cannot be resolved quickly, the closing date may need to be extended.
This can happen when:
- legal documentation is required
- a lien payoff must be negotiated
- ownership claims need clarification
- government records must be corrected
In most cases, the buyer and seller simply agree to extend the closing timeline while the issue is resolved.
Why Title Insurance Is Important
Even though title companies conduct extensive title searches, some problems may not appear in public records.
Title insurance protects the buyer and lender against certain title issues that could arise after closing.
This is why title insurance is a standard part of most Washington real estate transactions.
Bottom Line
If a title problem is discovered before closing in Washington real estate, the issue usually must be resolved before the property can transfer to the buyer. The title company typically works with the parties to clear the problem so the transaction can proceed.
FAQ
What happens if a title problem is found before closing?
The issue must usually be resolved before the property can transfer to the buyer. The title company works to clear liens, errors, or ownership issues before closing.
Can a real estate transaction close with a title problem?
Most title problems must be resolved before closing because buyers need clear ownership of the property.
Who fixes title problems during a transaction?
The title company typically works with the seller, lenders, and attorneys if necessary to resolve title issues before closing.
Do title problems cancel the real estate contract?
Not usually. Most title issues are resolved before closing, although the closing date may be delayed while the issue is cleared.