A title report provides important information about a property’s recorded ownership and any issues that can affect the title. Liens, judgments, unreleased mortgages, easements, and other encumbrances can create complications or delay a real estate closing. Reviewing the report early gives buyers and their attorneys time to identify and address potential title issues before closing.
At Avenue Law Firm, Managing Partner Peter Zinkovetsky assists buyers and sellers with title matters that arise during New York real estate transactions. Our team of Manhattan real estate attorneys reviews title reports, explains exceptions and requirements, and helps address potential defects before closing.
This guide explains what a title report contains, how to read it before closing, the defects that commonly appear, how those issues may be resolved, what happens if a problem is discovered after closing, and the costs associated with title searches and title insurance.
If you have questions about a title report or an issue that could affect your closing, call Avenue Law Firm at (212) 729-4090.
What Is Included in a New York Title Report?
A title report summarizes information found in public records about a property. It draws from deeds, mortgages, court judgments, municipal filings, and other records to identify the current record owner and issues that could affect the title.
The report typically includes several key components:
- Ownership and vesting: who holds record title and how title is held
- Legal description: the property’s formal legal description, often using metes and bounds or lot and block
- Liens and mortgages: recorded monetary claims and mortgages affecting the property
- Judgments: docketed judgments that affect the owner’s real property
- Easements and restrictions: recorded rights or restrictions affecting the use of the property
- Exceptions: matters excluded from title insurance coverage
- Requirements: documents, payoffs, releases, or other conditions that must be satisfied before the policy is issued
A real estate attorney can review these components to determine which items require attention before closing and whether additional documents or corrective action are needed.
What Does the “Chain of Title” Section Show?
The chain of title traces the property’s ownership history and shows how it passed from one owner to the next. Each transfer should be properly documented and recorded to establish a clear, continuous ownership history.
A missing deed, a transfer made without proper authority, or an unaccounted-for heir can create a gap in that history and raise questions about ownership. These issues can cloud the title and need to be addressed before the title company can issue coverage.
What Are Exceptions on a Title Report?
Exceptions identify property-specific matters that the title insurance policy does not cover. These can include recorded easements, restrictive covenants, liens, and certain survey matters. Because an exception can affect a buyer’s rights or title insurance coverage, it is important to understand its effect before completing the transaction.
Policy exclusions are different from exceptions. While exceptions concern specific matters affecting the property, exclusions are broader limitations contained in the title insurance policy.
Key Takeaway: A New York title report provides important information about the property’s ownership history, recorded claims, requirements, and exceptions. A careful legal review can identify issues that need to be addressed and clarify how they could affect the transaction before closing.
If you have questions about a title report or an exception affecting your transaction, Avenue Law Firm can review the documents and explain your options. Call (212) 729-4090 to speak with a New York real estate attorney about your closing.
How Do You Read a Title Report Before Closing?
Reading a title report starts with Schedule A and Schedule B, which provide different information about the property and the proposed title coverage. Schedule A focuses on the basic details of the transaction, while Schedule B identifies matters that need to be reviewed before closing.
Schedule A includes the current record owner, legal description, interest being conveyed, and proposed amount of insurance. Compare these details with the purchase contract to confirm that the seller’s name and property description are accurate and consistent with the transaction.
Schedule B covers matters affecting the title, including open mortgages, liens, easements, exceptions, and requirements. Some items must be resolved or satisfied before closing, while permitted exceptions can remain in the final title policy.
| Feature | Schedule A | Schedule B |
|---|---|---|
| Purpose | Provides the basic details of the proposed coverage | Lists requirements and exceptions affecting title |
| Owner | Identifies the current record owner | — |
| Property | Provides the legal description | — |
| Coverage | States the proposed amount of insurance | Identifies matters affecting coverage |
| Liens and mortgages | — | Lists open liens and mortgages |
| Easements | — | Identifies recorded easements |
| Requirements | — | Lists items that must be addressed as required by the title company |
Key Takeaway: Schedule A provides the basic details of the proposed title coverage, while Schedule B identifies requirements and exceptions that affect the property.
Avenue Law Firm can review your title report and help address Schedule B requirements or other title concerns before closing. Call (212) 729-4090 to discuss your New York real estate transaction.
What Are the Most Common Title Defects in New York?
Common title defects in New York include liens and problems with recorded documents. Unpaid property taxes and municipal charges can result in liens against the property, while mechanic’s liens can arise from unpaid construction or renovation work.
Money judgments can also affect titles. Under CPLR § 5203, a docketed judgment can become a lien on the debtor’s real property in the county where the judgment is docketed. For Manhattan properties, the New York County Clerk‘s Judgment Docket and Lien Section is one source used to identify these judgments.
Other title defects include mortgages that were paid off but never formally discharged, boundary or easement disputes, and forged or improperly executed deeds. These issues can affect the transfer of clear title and require further review before closing.
Why Are Co-op Title Issues Different From Condo or House Purchases?
A co-op purchase does not involve a deed because the buyer acquires shares in a corporation along with a proprietary lease rather than deeded real property. As a result, the title review differs from the process used for a condo or house.
For a co-op, the review focuses on the stock certificate, proprietary lease, and liens against the shares. Uniform Commercial Code (UCC) filings, unpaid maintenance charges, and loans secured by the shares are also checked to identify outstanding interests or obligations connected to the ownership.
Addressing title defects before closing can help keep the process on track and clarify what remains to be resolved. Call Avenue Law Firm at (212) 729-4090 for guidance on liens, judgments, or other title concerns.
New York Real Estate Attorney – Avenue Law Firm
Peter Zinkovetsky, Esq.
Peter Zinkovetsky is the founder and Managing Partner of Avenue Law Firm, where he focuses his practice on real estate transactions and property and business insurance. He earned his Juris Doctor from New York Law School and a Bachelor of Business Administration in Finance from Pace University and has been admitted to practice in New York since 2011.
Peter has been named a Rising Star by Super Lawyers for eight consecutive years and was included in the New York Real Estate Journal’s 2018 Ones to Watch list. He has also written for the New York Real Estate Journal, taught continuing education courses, and been featured in publications including Forbes, the New York Post, The Real Deal, Newsweek, and the New York Observer.
How Are Title Defects Resolved Before Closing in New York?
The steps needed to resolve a title defect depend on the type of issue involved. Before closing, outstanding Schedule B requirements must be addressed to the title company’s satisfaction so it can issue the agreed-upon coverage.
Monetary liens can often be paid at or before closing, including from the seller’s proceeds. An unreleased mortgage can be addressed by obtaining and recording the appropriate satisfaction or release, while a judgment lien can be resolved through payment and the required satisfaction documents.
Other defects require different solutions. A break in the chain of title or a competing ownership claim can require corrective documents or an action under RPAPL Article 15 to determine an adverse claim to real property. When an issue cannot be cured before closing, the options depend on the contract and the title insurer and can include postponing the closing, establishing an escrow or indemnity arrangement, obtaining approved title coverage, negotiating a credit or price adjustment, or exercising applicable contractual rights.
Avenue Law Firm can assist with resolving title issues and coordinating the documents required for closing. Call (212) 729-4090 to speak with our team about a title defect affecting your property.
What Happens If a Title Defect Is Found After Closing?
An owner’s title insurance policy can provide protection when a covered title defect is discovered after closing. Coverage applies to certain claims that existed before the purchase but were not identified before the policy was issued.
For example, a previously undiscovered lien or an ownership claim from an heir can lead to a title insurance claim. After the insurer is notified, it reviews the claim to determine whether it falls within the policy’s coverage. Depending on the policy terms and the defect involved, coverage can include legal defense costs and financial losses up to the policy limit.
Title insurance does not cover every issue. Matters listed as exceptions in the policy and those excluded by its terms are outside the scope of coverage, making it important to review these provisions before closing. An owner’s policy is typically purchased with a one-time premium, with coverage continuing according to its terms while the insured retains a covered interest in the property.
Questions about a post-closing title issue often depend on the specific language of the owner’s policy. Contact Avenue Law Firm at (212) 729-4090 to discuss the defect and review your available options.
What Costs Are Associated With a Title Report and Title Insurance in New York?
Title-related costs in New York can include title search fees, title insurance premiums, recording fees, and other charges connected with the closing. The amount depends on the property, the coverage being purchased, and the services required.
Title insurance rates and rating rules are subject to approval by the New York State Department of Financial Services. Many insurers use rates filed through the Title Insurance Rate Service Association (TIRSA), while insurers can also file their own rates and rules for approval. The cost of an owner’s policy is tied to the amount of coverage, often based on the purchase price, while a lender’s policy is tied to the mortgage amount. Search fees, recording fees, and other transaction-related charges are separate.
Certain standalone abstracts of title and public-record searches are treated as taxable information services in New York. Title insurance and certain charges connected with issuing a title insurance policy receive different tax treatment. An itemized title quote can show how the insurance premium, search fees, recording charges, taxes, and other costs apply to a particular closing.
Key Takeaway: Title-related costs vary based on the property, coverage, and services involved. Title insurance rates are subject to state approval, while separate search, recording, and related charges can affect the total cost.
An itemized review can clarify how title insurance premiums, search fees, recording charges, and other costs are calculated for a closing. Contact Avenue Law Firm at (212) 729-4090 for help understanding the title-related costs associated with your property.
Get Help from a New York Real Estate Attorney
Title issues can affect a closing when they are not identified and addressed in time. Liens, breaks in the chain of title, open mortgages, and other defects can require additional documents or corrective steps before the transaction can proceed.
Avenue Law Firm represents buyers, sellers, and lenders in Manhattan and throughout New York City. Peter Zinkovetsky and our team of real estate attorneys in New York review title reports, address Schedule B requirements, negotiate solutions when issues arise, and coordinate the work needed to resolve title defects before closing.
Call Avenue Law Firm at (212) 729-4090 for a consultation about your real estate matter. Our office at 505 Park Avenue in Manhattan serves clients throughout New York City.
Frequently Asked Questions
What is the difference between a title report and title insurance?
A title report summarizes information found in public records, including ownership, liens, judgments, and easements. Title insurance is a policy that provides coverage for certain title defects and claims. The report identifies issues before closing, while the policy provides protection against covered losses.
How long does a title search take in New York?
The timing of a title search depends on the property’s history, the availability of public records, and the scope of the search. Properties with complex ownership histories or issues that require additional research can take longer to review.
Who orders the title report in a New York real estate deal?
The buyer’s attorney often orders the title report from a title company after the contract is signed. The title company conducts the search and prepares the report, and the buyer typically pays the associated title costs at closing.
Can a title report affect a co-op purchase?
Co-op purchases do not use a traditional deed-based title report because the buyer acquires shares in a cooperative corporation along with a proprietary lease rather than deeded real property. The review instead focuses on lien and UCC searches, the stock certificate, the proprietary lease, and related ownership documents.
What if I find an error on my title report?
Notify your attorney and the title company and provide documents that support the correction, such as a recorded satisfaction or corrected deed. Once the issue is verified, the title company can update the report and determine whether the related requirement or exception should be revised or removed.
