TITLE INSURANCE & OTHER TITLE ISSUES

A title commitment (formerly known as a preliminary title report) is delivered to the buyer by the title company without any cost to the buyer after escrow is opened. It has one purpose: to commit the title insurance company to issue a title insurance policy at close of escrow based on the exclusions, exceptions and requirements stated in the title commitment.

You may be able to find a title company that will “insure over” this lien with the bonding company. In other words, the title company will give a buyer of the home a “clean” title report without the lien of the bonding company. The reasoning of the title company would be that the “reward” of clear title through escrow fees and title insurance fees outweighs the minimal “risk” of the defunct bonding company enforcing this 1994 lien.

If a title company will not “insure over” this lien of the bonding company, you will have to file a quiet title law suit naming the bonding company as a defendant. The bonding company can be served by a newspaper publication, and assuming that the bonding company is defunct and does not answer the lawsuit, you should receive a default judgment extinguishing the lien of the bonding company on your home.

When the boyfriend deeded the home to his adult daughter, the joint tenancy with right of survivorship with your daughter was terminated. Your daughter and her boyfriend’s daughter now own the home as 50-50 tenants in common.  Your daughter’s boyfriend no longer has any interest in the home, and his death would have no effect on the ownership of the home.

Note:  Although a transfer by deed of a home owned as joint tenants with right of survivorship interest terminates the joint tenancy, a mortgage or lease by one joint tenant generally does not. In other words, if your daughter’s boyfriend had taken out a mortgage on the home, your daughter and her boyfriend would probably still own the home as joint tenants with right of survivorship.

Under a general warranty deed the seller warrants that the title being transferred to the buyer is valid and free of any title defects back to the beginning of time.  A special warranty deed warrants title only for the time period in which the seller owned the property.   The distinction, however, between a general warranty deed and a special warranty deed is generally immaterial if the buyer has title insurance.