Title Issues Do Arise And Must Be Cleared to Close

When Selling your Lake Charles Home and the Seller negotiates an accepted contract,  a Title Search will done and  reviewed by the real estate attorney of the Title Company handling the Buyer’s closing.


When buyers and sellers approach closing date, during the interim period, the Title Company Attorney is reviewing the title on the property and going back 30 years in order to  issue the title commitment  Merchantable Title must be delivered to the Buyer . There is language in the Louisiana Agreement to Buy/Sell that addresses the merchantable title.  Should the Seller not be able to provide a “clear merchantable title” the contract can be declared null and void.


Title issues do arise and it is not uncommon for a correction to be made that could be something like a missed signature or succession document that needs to be filed in the courthouse records.  However when a lien or “surprise” mortgage is discovered this requires more diligence to clear due to the property being used as collateral.

1264 tomahawk SOLD

This was the case in the sale of 1264 Tomahawk when the real estate attorney discovered an outstanding small business authority (SBA Loan) in the amount of $10,000 filed in 2006!!  The Sellers neglected to disclose this fact on the Louisiana Property Disclosures and to the Listing Agent!  Without the Notice of Seizure filed and  attached to the residential property being paid off and recorded as clear,  the sale of 1264 Tomahawk could not occur.

24 hours before closing when the HUD was being prepared and payoffs obtained by the Title Company it was discovered that the   Sellers of Tomahawk had also just re-financed the house in 2012….. so there went the equity!  The Sellers were already taking a $10,000 loss on the sale of their home and did not have enough proceeds in the sale to cover the outstanding $10,000 SBA Loan in addition to the mortgage payoff.


Homeowners and Sellers should always disclose any mortgage or outstanding loan connected to the property to the listing agent.  Usually this is done at the time of the listing when the Realtor is going over the list price, market analysis and expense connected witht he sale of the home.   Sellers always ask the question what are the costs of selling my home.  Most Sellers have an idea what their payoff is and can factor that into the calculations associated with the listing and sale of their home.  It is important for the listing agent to know the seller’s position in order to be able to advise and negotiate a contract in the Seller’s best interest

No one likes surprises especially at the closing table!

No Home Seller likes a loss, Title Issues can be cleared.  1264 Tomahawk  did close however it was not without a price by the Sellers to the tune of $21,000  they had to bring to the table at closing!



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