Cloud on Title

Cloud on Title

A cloud on title refers to a claim or condition that appears in the public record and may affect the validity or ownership of a property. This encumbrance can create uncertainty regarding the title, making it difficult for the current owner to sell or mortgage the property without resolving the issue first.

A cloud on title may arise from various sources, such as:

1. Unpaid liens: This can include mortgage liens, property tax liens, or mechanics’ liens that have not been satisfied.

2. Judgments: If there is a court judgment against the property owner, it may create a lien on the property, affecting the title.

3. Easements: A recorded easement granting others the right to use a portion of the property can also create a cloud.

4. Errors in public records: Mistakes such as incorrect property descriptions, misspellings of names, or improperly filed documents can lead to confusion about ownership.

5. Disputes over ownership: Claims from individuals who believe they have a legal interest in the property can also cloud the title.

To clear a cloud on title, the property owner may need to take specific legal actions, such as negotiating with lienholders, filing a quiet title action to resolve disputes, or correcting public record errors. Successful resolution of a cloud on title is essential for the property owner to ensure clear ownership and to facilitate future transactions involving the property.