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Common Legal Issues in Escrow & Closing

Buying a home can be a stressful experience. While the end of the road is one of the most satisfying and rewarding investments you’ll ever make, the escrow and closing processes of your deal can be filled with surprises (and not the good kind, either). Because escrow and closing are bound by so many different laws and rules, it’s important to make sure you follow procedures properly and your best interests remain protected. Of course, the best way to make sure your deal goes over smoothly is to prepare for any of these issues that may arise. Here are just a few of the more common legal issues that can pop up during the closing and escrow process.

Title Issues

It might surprise you to learn just how many homes or properties have “clouds” or “defects” against them that would prevent the title from being transferred. Before the seller can officially transfer the title of their property over to you, the title must be completely clear of all title issues, which can come in many different forms. Three of the most common types of these issues are mechanic’s liens, child support liens, and bankruptcy. While some of these are fairly easy to remove, others may require significant work, which means you as a seller should have an attorney on your side as well as a reputable title company who can work to clear these issues and make your title marketable again quickly to allow your deal to proceed.

Escrow Accounts

A real estate broker or title agent is often entrusted with managing the escrow account for their client. In essence, this account holds their client’s funds until the deal closes and they are distributed to the buyer. However, misconduct with these accounts is a possibility. Escrow agents are forbidden from co-mingling funds (mixing their personal funds with an escrow account), using escrow funds for their personal purposes, and more. As a buyer, you can also hold your escrow agent liable in the event they breach their contract or default on their responsibilities.

Mortgage Issues

As a buyer, you will have several different parties involved in the purchase of your home, perhaps the most important of which is a lender. Your lender will want to make sure their investment is secure and prudent, so the property will likely need to be appraised, and you’ll have to make sure you fill out all applications and paperwork correctly. Nonetheless, if you do so and you still face difficulties from your lender, you should still ensure you have an attorney on your side to make sure your rights are protected and that you aren’t being unfairly discriminated against.

A Miami insurance attorney from The Morgan Law Group, P.A. can stand by your side during the escrow and closing process to help you get the home of your dreams! Contact us today at (844) 818-0774 for a case evaluation!