What is considered a title defect?

A title defect refers to any discrepancy or flaw in the ownership history or title report of a property that can undermine the validity of the title or create disputes over property ownership. This can include issues such as unpaid liens, outstanding mortgages, easements, or even claims by unknown heirs. Such defects can create legal barriers for the property owner, affecting their ability to sell or transfer the property, as well as potentially leading to costly litigation.

Understanding the nature of title defects is crucial for lease and title analysts, as it impacts property transactions and the security of titles. In contrast, financial obligations on a property, features that enhance property value, and clauses in a lease agreement do not qualify as defects in the title itself. These are separate issues concerning the financial or contractual aspects of property and do not directly relate to ownership flaws in the title or its history.