Stop Royal Oak Title Issues Before Closing Day Trouble

TL;DR: In Michigan, many title problems do not become visible until the title search and commitment are issued after the purchase agreement. If defects are found late, the title insurer and lender may require cures (releases, corrected recordings, estate/trust authority documents, or sometimes court action) before closing can fund and record. Start review early, read the commitment, and escalate unusual exceptions quickly. Contact our office if you want an attorney to review your commitment and cure plan.

Why title issues show up late and why that is risky

In many Michigan transactions, the first comprehensive look at the public-record chain of title happens after the parties sign the purchase agreement and the title company issues a title commitment (a conditional promise to insure, not the final policy). When defects or requirements appear late in the timeline, buyers, sellers, and lenders may have limited time to obtain documents, record corrections, or resolve payoff disputes before the scheduled closing.

Michigan recording rules matter here: recorded interests generally affect priority and provide notice to later purchasers, so missing releases or incorrect recordings can create real closing friction. See Michigan’s recording statute at MCL 565.29.

Common Royal Oak title issues that can hold up closing

Unreleased mortgages or liens: A prior loan may have been paid, but the discharge was never recorded (or was recorded incorrectly). Michigan addresses mortgage discharges at MCL 565.41.
Judgment and creditor liens: A properly recorded judgment lien can attach to real property and may need to be addressed to satisfy a lender or title insurer. See MCL 600.2803.
Construction/contractor lien risks: Where work was performed and payment disputes exist, construction lien issues may arise under Michigan’s Construction Lien Act. See MCL 570.1101 et seq.
Boundary, survey, and encroachment concerns: Fences, driveways, garages, or additions may cross lot lines or sit in easements.
Easements and access: Utility easements are common. More sensitive issues include shared driveways, unclear ingress/egress rights, or ambiguous rights-of-way that can affect use and financing.
Probate, trust, and authority-to-sell problems: If an owner died or title is held in trust, the buyer and title insurer typically need proof the signer has authority to convey. Michigan probate powers for personal representatives are addressed in MCL 700.3701, and trustee powers are addressed in MCL 700.7817.
Name discrepancies and recording errors: Misspellings, inconsistent initials, or legal-description mistakes can trigger underwriting requirements. Michigan permits certain recordable affidavits related to title matters; see MCL 565.451a.
Timing (gap) risks: Issues recorded between signing and recording (for example, newly recorded liens) can complicate closing logistics.

Red flags to watch for before you are days from closing

These are not automatic deal-breakers, but they often justify earlier title review and more lead time for cures:

Seller has owned the property for a short time.
Sale involves an estate, trust, divorce, guardianship, or power of attorney.
Major improvements without clear paperwork.
Shared driveway or unclear parking arrangement.
Prior foreclosure, short sale, or loan modification history.
Seller references old debts “that were taken care of,” but cannot locate releases or payoff letters.

Tip: Treat the title commitment like a to-do list

Do not skim the exceptions. Ask for the underlying recorded documents for any easement, restriction, or covenant you do not understand, and confirm whether your lender requires changes (for example, endorsements) before funding.

Checklist: What to do as soon as the title commitment arrives

Confirm the legal description matches the property you believe you are buying/selling.
Review Schedule B requirements (what must be satisfied before the policy can be issued).
Review Schedule B exceptions (what the policy may not cover).
Request copies of every recorded document cited by exception.
Flag authority issues early (estate/trust/POA/divorce documentation).
Assign each cure item to a responsible party (seller, title company, lender, HOA/condo, counsel).
Set a cure deadline well before closing week to allow recording time.

Title insurance: what it does and what it does not

Title insurance is intended to protect against certain covered title defects, subject to the policy’s terms, exclusions, and the specific exceptions listed in the commitment/policy. A lender’s policy protects the lender’s interest; an owner’s policy is intended to protect the buyer/owner. Consumer background is available from the CFPB: What is title insurance?

Important: Coverage is policy-specific. Items listed as exceptions are commonly not covered unless modified by endorsement.

How cures usually work in Michigan

The appropriate cure depends on the defect, third-party cooperation, and title underwriting requirements. Common cure paths include:

Payoff and release/discharge: Paying a lien and recording a release/discharge (see MCL 565.41).
Correction instruments: Corrective deeds or other recorded instruments to fix errors.
Recordable affidavits (where appropriate): See MCL 565.451a.
Court involvement when necessary: If ownership is disputed or records cannot be reconciled, a quiet title action may be required; see MCL 600.2932.

FAQ (Michigan and Royal Oak closings)

Is a title commitment the same as a title policy?

No. A commitment is a conditional promise to issue a policy if listed requirements are satisfied; the policy is issued after closing/recording (and any final conditions are met).

If a mortgage was paid off years ago, why might it still appear?

The payoff may have occurred, but the discharge may not have been recorded or may have been recorded incorrectly. Discharge rules are addressed in MCL 565.41.

Can we close if there is an old lien showing?

Sometimes, but it depends on the lien type, whether the title insurer will insure over it, and whether your lender will fund. Many transactions require a recorded release or other acceptable cure before closing can proceed.

Do I need a survey?

Not always, but a survey can be valuable where boundaries, fences, driveways, additions, or easements could affect use, insurability, or lender requirements.

When should we involve a Michigan real estate attorney?

Consider legal help when a lien is disputed, authority to sell is unclear (estate/trust/divorce/POA), the commitment lists unfamiliar exceptions, or a boundary/access conflict is developing. Contact our office to discuss a title review.

Next step: get the commitment reviewed before it becomes an emergency

If you are under contract in Royal Oak or elsewhere in Michigan and you want a second set of eyes on your title commitment, exceptions, and cure plan, schedule a consultation.