When engaging in a real estate purchase, sale, or refinance, few things are as crucial yet underappreciated as the title. The state of a property’s title—whether clear or clouded—can make or break a transaction. For many homebuyers, sellers, realtors, and lenders across Minnesota, understanding common title issues and how to resolve them is a key part of protecting your investment and avoiding surprises.
All Seasons Title aims to be a trusted partner for title services in Minnesota, offering thorough title searches, closing services, and title insurance to diverse clients: realtors, lenders, homebuyers, attorneys, developers, and investors.
In this article, we’ll explore:
- What a “clouded title” means
- Common title defects encountered in real estate
- How title professionals uncover and rectify issues
- The role of title insurance and best practices
- Why using a local and experienced title company matters
Whether you’re a first-time buyer or a seasoned real estate professional, you’ll find useful background and practical context here.
What Is a “Clouded Title”?
A “cloud on title” (or title defect) refers to any irregularity, claim, lien, or encumbrance that casts doubt on the legal ownership or transferability of a property. Common examples include:
- Unreleased mortgages or liens
- Errors in recording deeds or names
- Undisclosed easements or boundary disputes
- Forged or fraudulent documents
- Mistakes in public records
Because titles are built over decades of ownership, deeds, mortgages, liens, and public records, even minor clerical mistakes or omissions can create a “cloud” that must be cleared before a clean transfer can occur.
7 Common Title Issues in Real Estate
Here are some of the most frequent defects encountered—and what they typically entail:
- Unpaid Liens or Mortgages
Liens often arise from unpaid taxes, contractor bills, judgments, or previous mortgages. Even if tied to a prior owner, these liens can attach to the property and must be resolved.
- Errors in Public Records
Misspelled names, incorrect legal descriptions, or misfiled documents may conflict with ownership records, causing title ambiguity.
- Boundary Disputes & Survey Problems
If a survey doesn’t match recorded property lines, or a neighbor claims encroachment, the discrepancy must be reconciled.
- Undisclosed Easements or Encroachments
Easements give third parties specific rights (for utilities, access, etc.) that might impact value or use. Encroachments happen when structures extend over property lines.
- Forged or Fraudulent Documents
Fraudulent deeds or improper execution of documents (e.g. by expired power of attorney) can cast serious doubt on title legitimacy.
- Missing Heirs, Unknown Ownership Interests
If heirs or unknown parties have claims (especially in inherited property), those interests must be addressed.
- Judgment Liens or Bankruptcy Actions
Legal judgments or bankruptcy court orders may attach claims to the property that outlast changes in ownership.
How Title Professionals Identify and Resolve Issues
Title Search & Examination
The first step is a comprehensive title search. Title professionals scour:
- County land records
- Tax assessor records
- Judicial liens, court judgments
- Probate and estate files
- Deed transactions and chain of title
This reveals existing encumbrances, discrepancies, or risk zones.
If defects are found, the title examiner tries to trace their origin, verify validity, and assess remedies. In many cases, they work jointly with legal counsel or local authorities to clear the defect.
Curative Work
Depending on the issue, curative actions may include:
- Paying off liens or negotiating releases
- Filing corrective deeds, affidavits, or quitclaim deeds
- Quiet title lawsuits to resolve ownership disputes
- Boundary agreements or re-surveys
- Recording missing or supplemental documents
Title professionals often coordinate with attorneys, surveyors, or the county recorder’s office to ensure the issue is properly resolved.
Title Insurance & Coverage
Even with the best preventive work, some latent problems may surface later. That’s where title insurance comes in. Unlike other insurance, title insurance insures against past defects—not future events.
There are typically two policies:
- Lender’s (mortgagee) title insurance: Protects the lender’s investment
- Owner’s title insurance: Protects the buyer’s ownership interest
Minnesota law allows the homebuyer to choose the title insurance provider.
Title insurance can cover:
- Unknown liens or encumbrances
- Missing heirs or forged documents
- Errors in public records
- Boundary or survey issues in some cases
- Legal fees to defend claims on title
By combining thorough search, curative work, and insurance coverage, title services aim to deliver a marketable title, free of clouds, giving confidence to all parties in the transaction.
Why Local Expertise Matters
Working with a local title company like All Seasons Title (serving Minnesota) has distinct advantages:
- Familiarity with county record systems, local quirks, and local law
- Relationships with county recorders, surveyors, real estate attorneys, and municipal offices
- Better understanding of regional title risk patterns
- Faster response times and better coordination on curative tasks
National or out-of-state providers may lack that nuanced local insight—especially useful when dealing with quirks in rural or less common jurisdictions.
Additionally, All Seasons Title’s positioning for realtors, homebuyers, and lenders indicates a versatile capability across client types.
Best Practices to Minimize Title Risks
Here are tips for various stakeholders:
- Homebuyers & Sellers
- Always request to review the title commitment early
- Ask for full documentation of any liens or encumbrances
- Don’t waive your right to title insurance
- Ensure surveys are current
- Realtors & Agents
- Recommend a reliable, local title company early in the transaction
- Encourage clients to review items in the title commitment
- Monitor curative deadlines
- Lenders & Mortgage Professionals
- Insist on clarity in the commitment regarding liens, gaps, and exceptions
- Coordinate curative work before closing
- Confirm proper recording and release of encumbrances
- Title Service Firms
- Maintain updated knowledge of county-level systems
- Build relationships with local surveyors, attorneys, and recorder offices
- Educate clients on risks and preventive measures
By staying vigilant and proactive, most title issues can be detected and resolved well before closing.
Sample Use Case: Fixing a Clouded Title
Imagine a buyer in rural Minnesota is purchasing a property. During the search, the title examiner finds:
- A 1990s mortgage that was never recorded released
- A boundary discrepancy: the recorded lot line differs from a recent survey
- A small encroachment: neighbor’s fence intrudes a few feet
Steps to resolve:
- Locate the mortgage release document in archived county records or demand statement, then file a release (or lien satisfaction).
- Compare survey to deeds, negotiate with neighbor, or prepare a boundary-line agreement and record it.
- Correct the deed or execute a corrective plat map reflecting the accurate lot line.
- Provide the buyer with an owner’s title insurance policy covering any residual risk.
A strong title firm handles much of this behind the scenes, smoothing what could otherwise become a deal breaker.
How All Seasons Title Adds Value
While we avoid overselling here, it’s useful to highlight what a knowledgeable, local title partner can contribute:
- Deep understanding of Minnesota real estate and county record systems
- Capabilities across agents, consumers, and lenders
- Thorough closing support and documentation handling
- Guidance through complex curative processes
Rather than direct calls to action, consider this post a reference: if you ever wonder whether a title is safe, whether an issue has been addressed, or whether to request changes, this serves as your primer.
The Minnesota Department of Commerce’s explanation of title insurance and consumer rights, which offers a solid foundational background on how title insurance works in Minnesota.
Title issues may seem abstract or arcane, but in real estate transactions they hold real power. Unresolved liens, recording errors, borderline surveys, or obscure claims can cause delays, add cost, or worse—dispute ownership.
By engaging professional title services that combine thorough search, curative work, local insight, and solid title insurance coverage, you minimize risk and create confidence for all parties in a transaction. Think of this post as a foundational resource—bookmark it, revisit when issues arise, and refer clients or partners who want to understand title fundamentals. Contact us to get started.
