So you are thinking about purchasing a property. How do you know if there will be additional hidden charges? Won’t the title search reveal any liens on the property? Did the previous owner have any unresolved violations or building permits?
To be sure, a title search will uncover any recorded liens on a property. However, few people are aware that there can be many other unrecorded charges on a property that can eventually result in a lien. These charges will no longer be the responsibility of the former property owner but if they go unpaid, they can become the responsibility of the current property owner. The same follows for unresolved violations, building permits which have not been closed properly or unpermitted structures. The new owner can become liable for an overlooked utility bill as well in some cases.
Who would report this information if it is not found in a title search?
A Municipal Lien Search will thoroughly investigate any violations, permits, unrecorded liens, taxes and utilities that are associated with the property. Even with the increasing sales of foreclosures in this current market, the bank’s title insurance agents are not conducting Municipal Lien Searches on properties. There is no one party that bears the responsibility of ordering such a report so it often gets overlooked. The assumption would be that the closing agent is informed enough to advise on such matters but this is not always the case. Nevertheless, it is ultimately the buyer’s responsibility to obtain this information.
When purchasing a foreclosed home, a prudent buyer will ask to see if a Municipal Lien Search has been ordered. It is well worth the small price tag to research this vital information that can possibly save thousands of dollars and many headaches in the future.