Title clearance can be most easily explained as the satisfaction of all of the requirements disclosed in Schedule B-I of our title commitment. We take care of the standard requirements – execution and recordation of deeds and mortgages – at closing. That’s the fun part! Clearance of the other requirements is completed prior to closing.
Here are a few examples of common clearance work. Let’s say the seller of a property has a mortgage. One of the most common clearance activities is ordering payoff statements from that mortgage lender or servicer and ensuring that the outstanding balance is paid off at closing from the seller’s proceeds. In Florida, many properties lie within community associations (condominium, homeowners or otherwise). In these cases, we are required to collect estoppel letters from the associations or their management companies and ensure that their instructions are followed. Estoppel letters tell us what is owed and how often payments are made; what, if any, capital contributions are required; and, what assessments may be in place. Another example of clearance work is resolving defects in the chain of title. For example, deeds are often not executed with the formalities required by Florida law. In such a case, we would have to track down the previous owner whose signature wasn’t witnessed or notarized properly and have them sign again. These are just a few examples of the clearance work we see every day.