Tag: mechanic’s Lien

Land Title Services For Builders

Title First works with national and regional home builders. From land take-downs, subdivision infrastructure and development, lot purchases and all the way through the final home sale. Title First’s builder division handles all the details.

A land title is a formal document that will outline the rights the owner has to the piece of property. While it confirms ownership, it also helps prospective buyers know about any existing liens, usage rights, easements, natural resource rights, and any other rights.

Title insurance shouldn’t be avoided when there will be a brand new home built on an open lot. People often think that because it’s only land, and no home on the property, there isn’t a need for title insurance. This is false. Most land is not completely claim-free, even empty, has a history. Before the first truck rolls in to begin construction, the land may have changed hands many times, thus ownership issues could be pending.

One concern is the possibility of a contractor’s lien (also called mechanic’s lien, or construction lien) which is a claim made by contractors or subcontractors who have performed work on the property, or if materials have been delivered, but haven’t not been paid for yet. In some states, architects, engineers, and surveyors may have filed a lien for services rendered.

Another potential risk is an unknown servitude, or a “burden” on the property. This is known as an “easement” in other states. A common servitude is a utility servitude, where a utility company may access your property to service utility lines. Other such servitudes are right of way or right of passage, pipelines, and mineral servitudes. Most servitudes are permanently attached to the property, so a property owner is subject to them whether they know about it or not.

Solutions

Title First offers a complete range of title solutions and settlement services for builders, including – Title and Closing for initial land purchase, Title and Closing for the construction loan, Customized construction draw disbursement, Construction draw updates, Timely recordings, Customized closing process for the finished home, including warranty presentation

Service

Title First’s Builder Division offers high-touch service designed to meet each builder’s needs, including – Single point-of-contact for all scheduling and processing, Underwriter approved builder rates, Personalized draw services, Pre-signed closing documents

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Mechanic’s Lien

The financial crisis of 2007-2008, also known as the global financial crisis and the 2008 financial crisis, is considered by many economists to have been the worst financial crisis since the Great Depression of the 1930s.

Since then and because of the losses, title insurance underwriters tightened their guidelines when working with residential properties to prevent further loss.

During the time of the financial crisis, title insurance underwriters often suffered loss due to mechanic’s lien claims.  A mechanic’s lien is a security interest in the title to property for the benefit of those who have supplied labor or materials that improve the property. The lien exists for both real property and personal property. The claim is issued when the work performed was not paid for.

The lien gives the debt holder the right to the property until the debt is paid in full and the property.  This could be an expensive situation for new homeowners, so it is important to ensure a property is lien-free before purchasing a home. This can be confirmed with a lien waiver or a paid receipt for any work completed on the property. A lien waiver is a document issued by the service provider that states they have received payment and waive the right to issue a lien against the property in the future.

Title First Agency will protect all property buyers by providing a clear title of the property. If there is a lien, the title won’t be clear and we will coordinate the activity and documentation from the participants and pull each piece together, including paid receipt of any improvements or repairs to the property.

If you’re planning to purchase a home, make sure you know the full status of the property and any lien claims.  Buying a home may be the single, largest financial purchase in your life and can signify a much-anticipated milestone. That’s why Title First offers a host of resources to help you understand this important personal transaction.

 

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