Quick Answer
Off-market buyers should independently verify ownership, existing liens, the legal description, the seller's authority to sell, and other title matters before committing to the purchase. Do not rely solely on the seller's representations about the property or their ownership.
Off-market properties can be excellent investment opportunities, but they also carry additional risk because they are not listed through traditional channels with the standard checks that come with a listed transaction.
Verify the Seller
In an off-market transaction, confirm that the person claiming to be the seller actually owns the property. Verify through public records, not just the seller's representations. Confirm that all individuals or entities with ownership interest are included in the transaction. If the property is held in a trust, confirm the trustee has authority. If held by an LLC, confirm the authorized representative. For more, see title considerations when buying directly from a homeowner.
Common Issues
- The seller overstates their ownership interest
- The property has liens the seller did not disclose
- The legal description does not match what the seller described
- The seller does not have spousal or co-owner consent to sell
- The property has encumbrances that affect its value or use
Open Title Early
In an off-market transaction, open title as early as possible. The title company can verify ownership, identify existing liens, and uncover any title issues before you commit significant funds. For early research, consider a Property DNA Report. Property DNA is an informational property-research resource and does not replace a professional title search, commitment, examination, or title insurance policy.