One of the main questions in a divorce is what will happen to the marital residence. Will it be sold? Or will one spouse purchase the interest of the other spouse. If it’s the latter, then an essential step for the purchasing spouse is to run a title search This is critical for several reasons.
- Verify Ownership
A title search ensures that the person selling or transferring the property has clear legal ownership. In divorce cases, one spouse may not be the sole owner, and the title search will confirm who holds the title and any shared interests.
- Identify Liens or Encumbrances
There could be existing liens (like mortgages, tax liens, or judgments) on the property. These need to be addressed before the buyout. Without a title search, the buying spouse could inherit debts they weren’t aware of.
- Uncover Hidden Claims
If there are any unresolved legal claims, such as disputes over property boundaries, easements, or rights of third parties, the title search will reveal them. These claims could impact your ownership rights or property value.
- Prevent Future Legal Issues
Ensuring a clean title through a title search helps avoid potential future legal problems, such as disputes over property ownership, which could arise if previous issues weren’t resolved.
- Satisfy Lender Requirements
If you’re taking out a mortgage to finance the buyout, the lender will likely require a title search to protect their interest in the property. Without a clear title, it would be difficult or impossible to secure financing.
- Resolve Divorce Settlement Issues
In a divorce settlement, both parties often share responsibilities for debts and assets. A title search clarifies the property's legal standing and ensures both parties can resolve outstanding issues equitably before completing the buyout.
By running a title search, you help ensure that any legal issues are identified, which helps protect both the buyer and the seller in a marital home buyout. If you have questions about how to handle the split of the marital residence in your divorce, contact the experienced family law attorneys at Cohn Lifland Pearlman Herrmann & Knopf LLP.