5 Problems a Title Search may Uncover Before You Buy a Home

A title search can uncover outstanding mortgages and liens, errors in deeds and public records, ownership or estate problems, recorded easements and rights-of-way, and other interests that may affect a property before closing. Based on the experience and research of Lesley Hurst and the team at Penn Charter Abstract, something that needs to be addressed before settlement turns up in roughly 25% to 35% of the real estate transactions they handle or review. Most are resolved behind the scenes without delaying closing, but some require additional coordination with lenders, municipalities, attorneys, heirs, prior owners, or other parties.

5 problems a title search may uncover before you buy a home.

1. Outstanding mortgages, liens, judgments, or taxes. A debt or recorded claim may still affect the property even when the seller did not realize it was there.
2. Errors in deeds or public records. Misspelled names, incorrect lot references, incomplete legal descriptions, or unreleased documents can create questions in the chain of title.
3. Boundary, survey, or property-description concerns. Recorded plans and descriptions may raise questions, although a title search alone does not necessarily reveal a physical encroachment such as a fence, shed, or driveway crossing a property line.
4. Estate or ownership problems. A prior owner may have died, an estate may need additional documentation, or an earlier transfer may not be clearly reflected in the public record.
5. Easements and rights-of-way. A shared driveway, utility access, road right-of-way, restriction, or other recorded interest may affect how part of the property can be used.

Finding one of these issues does not automatically mean a real estate transaction is in trouble. In many cases, identifying the problem is exactly what allows the title and closing team to determine what needs to happen before ownership changes hands.

How often does Penn Charter find a title issue?

Lesley Hurst, owner and president of Penn Charter Abstract, and her team estimate from their own transaction experience and research that an issue requiring some form of resolution before settlement appears in roughly 25% to 35% of the transactions they handle or review.

That is Penn Charter Abstract’s experience-based estimate, not a statewide Pennsylvania statistic. It also does not mean that one-quarter to one-third of closings are delayed.

In fact, Lesley and her team say that many of the issues they encounter in Lancaster and Central Pennsylvania are handled quietly as part of the normal title and settlement process. A payoff may need to be obtained, a release located, a document corrected, or additional information gathered before closing.

Some situations are more complicated. If the solution depends on a lender, municipality, attorney, estate representative, heir, prior owner, or another outside party, resolving the issue can take additional time and may affect the expected settlement date.

A Lancaster title search uncovered a HELOC the sellers did not expect

A recent Lancaster-area transaction handled by Penn Charter Abstract shows why title research matters even when everyone believes they already understand the property’s financial picture.

A local cash buyer was preparing to purchase a house. During Penn Charter’s title research, the team discovered an outstanding home equity line of credit connected to the property.

The sellers had not realized that the HELOC was still affecting the property. As a result, they owed more against the house than they had expected when they agreed to the sale.

The discovery did not automatically end the transaction, but it created a problem that had to be addressed before the parties could move forward. Penn Charter worked with the people involved so everyone understood what had been found and what needed to be resolved. In that particular transaction, the buyer ultimately increased the purchase price enough to help cover the outstanding loan and allow the sale to proceed.

That solution was specific to those parties and should not be treated as the expected answer in another transaction. The lesson is simpler: a debt connected to the property may exist even when the current parties are not fully aware of it, and a title search can bring that issue to light before settlement.

1. Outstanding liens, judgments, mortgages, and taxes

Outstanding financial claims are among the most common issues the Penn Charter team encounters in Central Pennsylvania.

An existing mortgage is not unusual when a home is sold. The important question is whether the mortgage and any other recorded claims affecting the property are identified and properly addressed as part of the transaction.

Other possibilities can include tax liens, judgments, municipal charges, mechanic’s liens, or an older mortgage or line of credit that was never properly released from the record.

The Pennsylvania Department of Revenue explains that when the Commonwealth files a lien for unpaid delinquent state taxes, that lien becomes a public record and can affect transactions such as a home sale. What must be done with any particular lien depends on the actual transaction, the type of lien, and the parties involved.

2. Errors in deeds and public records

Lancaster County includes homes and properties whose ownership histories stretch back many decades. A long history does not mean there is something wrong with the title, but it does mean there may be many documents in the chain of ownership.

Over time, human errors can appear in recorded documents. Penn Charter may encounter misspelled names, inconsistent names, incorrect lot references, incomplete property descriptions, unreleased prior documents, or other inconsistencies that need clarification.

Lancaster County’s Recorder of Deeds maintains public real-estate records that include deeds, mortgages, releases, easements, surveys, land plans, restrictions, and road rights-of-way. Those records help title professionals reconstruct the history of the property and identify recorded interests that may still matter today.

3. Boundary lines, surveys, and encroachments

Central Pennsylvania has a wide mix of real estate: older borough properties, suburban developments, rural parcels, farmland, shared driveways, and properties that may have been divided or transferred within families over time.

That can create questions about property descriptions, recorded plans, easements, rights-of-way, and boundaries.

There is an important distinction, however: a title search is not the same thing as a property survey. A title search may reveal recorded plans, legal descriptions, easements, and other documents that help identify a potential concern. It does not necessarily reveal a physical condition such as a neighbor’s fence, shed, garage, or driveway extending across a boundary line.

Depending on the property and transaction, a survey or other property-specific investigation may be needed to answer a physical boundary question.

4. Estates, heirs, and missing ownership steps

Title questions can also arise when property has passed from one generation to another.

A former owner may have died, an estate may require additional documentation, or the land records may not clearly reflect every step that was necessary to transfer ownership. In some cases, an heir or another person with a potential ownership interest may need to be identified or involved before the title issue can be resolved.

These situations can require more time because the people needed to resolve the issue may not be the buyer and seller who are preparing to sit down at settlement.

The appropriate solution depends heavily on the facts. A title company can identify and help coordinate the title-related requirements, but legal questions about an estate, disputed ownership, or inheritance may require advice from an attorney.

5. Easements, shared driveways, and rights-of-way

An easement generally gives another person or entity a defined right to use part of a property. Common examples can involve utility access, shared driveways, or road access.

An easement is not automatically a title defect and does not necessarily prevent a closing. Many properties have perfectly ordinary recorded easements.

What matters is that a buyer understands the recorded rights and restrictions affecting the property. That can become especially important when the buyer has plans for an addition, new structure, driveway, fencing, or another use of the land.

What happens when a title problem is found?

The next step depends on what was uncovered. A routine recorded mortgage may simply require the normal payoff and release process. A document discrepancy may require additional records. An estate issue may require involvement from people outside the immediate transaction. A disputed ownership question may require legal guidance.

For the buyer, the most useful questions are often straightforward:

• What exactly was found?
• Does it affect my ability to obtain the title required for this purchase?
• Who needs to resolve it?
• Is the issue expected to affect the closing date?
• Will the issue remain after closing, such as a valid easement or restriction?

A title problem is not automatically a failed transaction. But it should be understood before the buyer completes the purchase.

What a title search does not tell you

A title search is an important part of the closing process, but it should not be confused with every other form of real-estate due diligence.

A home inspection primarily evaluates the physical condition of the home. A survey can help establish physical boundaries and reveal certain encroachments. An appraisal addresses value for its intended purpose. A title search focuses on ownership history and recorded interests affecting the real estate.

A title search also cannot guarantee that every possible problem will appear in public records. That is one reason the title examination and title insurance conversations are related but separate. Title insurance provides protection according to the terms, conditions, exceptions, and exclusions of the particular policy.

For a broader look at what happens between an accepted agreement and settlement, see Penn Charter Abstract’s guide to how the title and settlement process works. Buyers can also learn more about Penn Charter’s residential title and closing services.

Watch: What Problems Can a Title Search Find Before You Buy a Home?

In this episode of The Central PA Closing Table, Brittney and Ashley walk through the five issues Penn Charter commonly encounters and explain the Lancaster-area HELOC situation that changed the financial picture of a recent transaction.

Frequently asked questions about title-search problems

Does finding a title problem mean the sale cannot close?

No. Many title issues can be addressed as part of the normal closing process. Others require additional documentation or coordination and may take more time. Whether a particular problem can be resolved, and how, depends on the facts of that transaction.

Can a seller be unaware of a lien or loan on the property?

Yes. Penn Charter has encountered transactions in which an outstanding obligation was not fully understood by the parties before the title research was completed. The Lancaster-area HELOC example in this article is one recent instance.

Will a title search find a fence or driveway that crosses a property line?

Not necessarily. A title search may reveal recorded plans, easements, rights-of-way, and property descriptions, but a physical encroachment may require a survey or other investigation.

Why can title issues take longer to resolve?

Some issues depend on someone outside the immediate buyer-seller transaction. A lender may need to provide a payoff or release, an estate may need documentation, an heir may need to be located, or another professional may need to address a legal question. Those additional steps can affect timing.

Sources and further reading

This article draws on the firsthand experience and research of Lesley Hurst and the Penn Charter Abstract team, along with current public information from the Pennsylvania Department of Revenue regarding state tax liens and Lancaster County’s Recorder of Deeds regarding the types of real-estate records maintained in the county.

Read the Podcast Transcript

Brittney: Welcome to The Central PA Closing Table, a podcast from Penn Charter Abstract in Lancaster, Pennsylvania. I’m your host, Brittney, and joining me is my co-host, Ashley.

Ashley: Today we’re talking about something buyers hear about all the time but may not fully understand: the title search. We’ve already talked about why a title search happens before closing. Today, though, I want to get very practical. What kinds of problems can it actually uncover?

Brittney: Quite a few. And this is where title work becomes very real. According to Lesley Hurst and the team here at Penn Charter Abstract, based on their experience and research, an issue that has to be resolved before settlement comes up in roughly 25 to 35 percent of real estate transactions they handle or review.

Ashley: That sounds like a lot. Does that mean one out of every three closings is in trouble?

Brittney: Not at all. Most of those issues are handled behind the scenes and never turn into a major delay. But some do require extra coordination with lenders, municipalities, attorneys, heirs, prior owners, or other outside parties. And when that happens, it can add time to the closing process.

Ashley: So what are the biggest things Lesley and the Penn Charter team tend to see here in Lancaster and Central Pennsylvania?

Brittney: They point to five recurring categories. The first is outstanding liens and judgments. That can include an old mortgage that was never properly satisfied, unpaid taxes, municipal charges, or other debts that have attached to the property or owner.

Pennsylvania treats certain tax liens as public records, and county property records can also show mortgages, releases, and other recorded interests. The key point for a buyer is that these items may have to be addressed before the property can transfer with the title required for the transaction.

Ashley: And sometimes the seller may not even know something is still there?

Brittney: Exactly. One of Lesley’s team members recently shared an example from a Lancaster-area transaction. A local cash buyer was preparing to purchase a house. During the title research, Penn Charter discovered that a HELOC connected to the property was still outstanding.

The sellers were not aware that the loan was still affecting the property, and it meant they owed more against the house than they had expected.

Ashley: That sounds like the kind of discovery that could stop everything.

Brittney: It certainly could have complicated the closing. But this is also a good example of what title professionals do after a problem is found. Penn Charter worked with the parties so everyone understood the issue and what had to be resolved. In this particular transaction, the buyer ultimately increased the offer enough to help cover the outstanding loan so the parties could move forward.

That won’t be the solution in every transaction, of course. But it shows why finding the issue before settlement matters. Nobody wants to discover an unexpected loan after ownership has already changed hands.

Ashley: What’s number two on the list?

Brittney: Errors in public records and deeds. Lancaster County has many older homes and properties with ownership histories that go back decades. Over time, clerical mistakes can creep into recorded documents: misspelled names, incorrect lot references, incomplete legal descriptions, or documents that were never properly released.

A title search follows that chain of ownership and can flag inconsistencies that need to be clarified before closing.

Ashley: And number three is boundary problems?

Brittney: Yes, with an important distinction. Boundary lines, encroachments, and survey issues can affect a transaction, especially in areas with older lot layouts, shared driveways, rural parcels, and properties that may have been divided years ago.

But a title search by itself does not necessarily reveal that a fence, shed, garage, or driveway physically crosses a property line. Those kinds of conditions may require a survey or other property-specific investigation. The title work can reveal recorded plans, easements, rights-of-way, or descriptions that help frame the issue.

Ashley: That seems especially relevant around Lancaster County, where you can go from a neighborhood development to older borough properties to farmland pretty quickly.

Brittney: Exactly. Central Pennsylvania has a real mix of property types and histories, which is one reason the details matter.

Ashley: What’s the fourth issue?

Brittney: Estates and missing ownership steps. Sometimes a property has passed through a family after an owner died, but the record does not clearly show that every necessary step was completed. There may be an estate that needs additional documentation, an heir whose interest has to be addressed, or a prior transfer that was never properly reflected in the land records.

Those situations can take more time because the title company may need information or action from people who are not directly sitting at the closing table.

Ashley: And the fifth?

Brittney: Easements and rights-of-way. Pennsylvania county recorders maintain records such as deeds, mortgages, easements, rights-of-way, restrictions, and subdivision plans. Those recorded rights can matter to a buyer even when there is nothing visibly wrong with the property.

Think about a shared driveway, utility access, or another recorded right to use part of the land. An easement is not automatically a problem. Many are completely normal. But buyers should understand recorded rights and restrictions that affect the property they are purchasing.

Ashley: So the big idea here is that a title search is looking for a different kind of problem than a home inspection.

Brittney: That’s exactly right. An inspection looks primarily at the physical condition of the home. Title work examines ownership and recorded interests connected to the property.

And if something does turn up, the right response usually isn’t panic. It’s: What did we find? How does it affect this transaction? And what needs to happen before we can close?

Ashley: That Lancaster HELOC story really makes the point. The house itself wasn’t the problem. The surprise was connected to the ownership and debt behind it.

Brittney: Right. And that’s why good title work can be so important. Many problems are routine and get resolved quietly. Others take some extra work. Either way, identifying them before settlement gives the parties a chance to deal with them before the keys change hands.

If you’re buying or selling property in Lancaster, Central Pennsylvania, or elsewhere Penn Charter serves, and you have questions about the title or settlement process, visit PennCharterAbstract.com or call 717-295-4520.

Ashley: Thanks for joining us at The Central PA Closing Table.

Brittney: We’ll see you next time.