What might a buyer do if they discover a defect in the title after purchasing a property?

When a buyer discovers a defect in the title after purchasing a property, filing a claim with their title insurance policy is a prudent course of action. Title insurance is designed to protect the buyer against losses arising from defects in the title that were not known at the time of purchase. This coverage includes issues like undisclosed liens, errors in public records, or ownership disputes that can surface after the transaction is completed.

By filing a claim, the buyer can seek financial compensation for any losses incurred due to these defects, allowing them to resolve the issue without bearing the full financial burden. Title insurance companies typically have processes in place to investigate claims, which can lead to either a settlement or legal representation if needed.

In contrast, contacting the previous owner for compensation may not be effective as they may have no obligation to address issues that arise after the sale, while suing the real estate agent could lead to complications since their role typically involves facilitating the transaction rather than guaranteeing the title's integrity. Selling the property immediately doesn't resolve the underlying title issues and could lead to further complications for the new buyer. Therefore, utilizing the title insurance policy is the most direct and legally supported method for addressing title defects post-purchase.