Quick Answer
A title defect is cured by whatever legal, documentary, financial, or underwriting action resolves the specific problem. The cure depends entirely on the nature of the defect, the jurisdiction, and the requirements of the title insurer.
Curing a title defect is rarely about a single solution. It is about identifying the problem, understanding how it affects title, and determining what is needed to resolve it to the satisfaction of the title insurer, the lender, and the parties to the transaction.
Step 1: Identify the Problem
The first step is accuracy. The title examiner must identify not just that something is wrong, but exactly what is wrong, where it occurred in the chain of title, and how it affects current ownership.
Step 2: Trace It Back
Once the defect is identified, the examiner traces it back to its origin. Who was involved? What documents exist? What happened and when? This background determines who must participate in the cure.
Step 3: Determine Who Must Participate
Depending on the defect, the cure may require involvement from the current owner, a prior owner, a lender, a trustee, an heir, a government agency, or a court. Each party's cooperation affects how quickly and easily the cure can be completed.
Step 4: Determine the Curative Requirement
Common curative actions include:
- Obtaining a release or reconveyance for a satisfied mortgage
- Recording a corrective deed for an error in a prior deed
- Filing an affidavit of heirship or pursuing probate for a deceased owner
- Obtaining documentation of authority for trust or entity issues
- Pursuing a quiet title action when voluntary cure is not possible
Learn how long each type of cure typically takes.
Step 5: Obtain Underwriting Approval
For significant defects, the title insurer's underwriting department must review and approve the proposed cure. Underwriting evaluates the risk and determines whether the insurer is willing to insure the title after the cure is complete. In some cases, the insurer may agree to insure over the defect rather than requiring a full cure.
WHAT HAPPENS NEXT?
Once the cure is identified and approved, these are the remaining steps: (1) The parties execute and obtain required documents. (2) Documents are reviewed by the title examiner. (3) If acceptable, documents are recorded (where applicable). (4) The title is re-examined to confirm the defect is resolved. (5) The transaction proceeds toward closing. (6) The title policy is issued. Each step can take additional time depending on the complexity of the defect and the responsiveness of the parties involved.
Cure vs. Insure Over
Not every defect must be fully cured. In some cases, the title insurer may agree to "insure over" the defect, meaning the insurer accepts the risk and issues the policy with specific exceptions or endorsements. This is not the same as curing the defect, but it may allow the transaction to close. Whether this option is available depends on the nature of the defect, the underwriting guidelines, and the parties' willingness to accept the limitations.
FAQs
Who pays for curing a title defect?
Responsibility depends on the nature of the defect and the terms of the purchase contract. In many cases, the seller is responsible for clearing title defects that existed before the transaction.
Can any title defect be cured?
Most can, but some defects may be so complex or longstanding that they require legal action, and some may ultimately prove impossible to fully resolve. Each situation is fact-specific.