Sometimes, a perplexing legal term (a genuine headscratcher) emerges when buying or selling a property. You know you should know it, but its precise definition escapes you. Today's special is: "What is an affidavit of title?"
Generally, an affidavit is a written statement or declaration made under oath before a licensed individual, such as a notary public or even a Judge. You've probably heard the term on police and legal courtroom TV shows. In other terms, it's a legal testimony the person swears by as the truth.
In real estate, an affidavit of title refers to a written statement made by the home seller. They testify to the “health” status of the property title. It is usually a request by title companies to issue title insurance. So, what is a real estate affidavit?
In the affidavit of title, the home seller states that the property is theirs to sell and that they aren’t selling to anyone else. Furthermore, they disclose any potential legal issues (like a financially harmful lien) the property might be facing. The affidavit of title should also address any bankruptcy proceedings the home seller might be going through, which could hold the house as a collateral asset.
The affidavit of title is intended to provide a safety net for the home buyer in case of any legal issues facing the seller and/or the house later on. It is produced during closing and can be one to five pages, depending on the number of encumbrances on the property.
Exclusions are an essential part of an affidavit of title. For instance, a home seller might state that some owed mortgage is still attached to the title, and they will pay it after closing. With this information, the home buyer can make an informed decision. Undeniably, it can be a double-edged sword. They can disregard it or assert that they will only proceed with the sale if the issue is resolved beforehand. This understanding empowers the home buyer in the transaction.
We advise you to seek an expert's assistance! It's crucial to ask for an "affidavit of title real estate" if you purchase a home as is or embark on owner financing. In both cases, the seller might feel in a pole position and could disregard mentioning certain legal troubles or property-related issues, such as roof disrepair.
First and foremost, we recommend a thorough house inspection from top to bottom to spot red flags. Suppose you need clarification on certain aspects of the home-buying process. In that case, members of the real estate agents directory can assist you! The platform has successfully connected parties in a real estate transaction with the most experienced and reliable agents for over twenty years!
A notary validates an affidavit of title. The legal document supplied by the seller of a piece of property testifies to the property's status and specific facts, such as ownership and legal concerns. An affidavit of title is intended to safeguard the property's buyer, who may be liable for pending legal problems with the home. If there is a lien (right to dispose of property) on the property, the seller may choose to satisfy the lien requirements to have the title reissued and "cleaned."
In some jurisdictions, an Affidavit of title is not just a formality. It's a mandatory requirement for the transfer of title to happen. This is an essential detail for home buyers and real estate professionals to be aware of, as it can enormously influence the transaction process.
