What does unmarketability of a title imply?

Unmarketability of a title refers specifically to a defect in the title that creates an impediment to achieving a clear and marketable title. When a title is unmarketable, it indicates that there is a flaw—such as a lien, encumbrance, or unresolved claim—that prevents the owner from conveying the title without putting the buyer at risk of legal challenges or claims against their ownership. These defects can significantly affect a buyer's willingness to purchase the property, as they create uncertainty regarding true ownership and rights associated with the property.

The concept of unmarketability is crucial in real estate transactions because it often necessitates clearing any title issues before a sale can occur. A title that is free from such defects is considered "marketable," meaning it can be readily sold or transferred without concerns for flaws that could affect ownership rights. Thus, identifying and addressing any issues linked to unmarketability is essential for a smooth transfer of property ownership.