An “abstract” is short for “abstract of title.” This legal document is absolutely vital in real estate transactions in Iowa. It includes all of the documents that are a part of the public record regarding a particular property. Relevant records found in an abstract are filed with the County Recorder’s Office, clerk of court and public records including certificates of marriage or death. These records are relevant to the transfer of real property in Iowa.
The Abstract and the Real Estate Sale Process in Iowa
In Iowa, the abstract is a vital part of the real estate sale process. Once an offer on a property has been accepted, the seller will ask an abstract company to do an “abstract continuation.” This process will ensure all relevant public records (new since last sale) are added to the abstract. The abstract must be updated every time the real property changes ownership.
An attorney will then review the abstract to give a “title opinion.” This opinion will set out any potential problems with a title so that the buyer knows whether there are any issues with ownership before the real estate transaction is complete. Once title issues are cleared, the seller has demonstrated they are providing “marketable title” to the buyer at closing.
What Type of Information is Included in an Abstract?
Virtually any data or information that affects the real estate could be included in the abstract. In fact, many real estate filings are required to be included in the abstract to be valid. The most common information found in an abstract includes:
- Ownership information. An abstract provides transfer records. You should be able to follow from one transaction to the next in a line. If you cannot, that could signify a serious problem with the title.
- Easements. An easement involves one portion of the property being granted for the use of another person or entity. They are often found on property lines, but not always. They might include locations where water or sewer lines run, for example.
- Survey data. You can determine the boundaries of your property with a survey. In some situations, you may not realize that a neighbor has encroached on your property with a building or fence until after you take a close look at a survey.
- Liens. When the property owner owes money to another person or entity, that can sometimes trigger the right to place a lien on the house. A lien is an unpaid debt that has been attached to the property. Generally, a lien must be paid off before a mortgagor will finance a purchase. Finding a lien that a seller did not know existed could undermine a real estate sale entirely.
Having a good title opinion to spot these issues is absolutely vital. Contact Danilson Law if you are in need of a title opinion or if you have questions or concerns about your abstract.
