Owners of Greenville's Tara Condominiums, beware of legal issues that could complicate the sale of your property.
Agents at Tyre Realty Group say a number of the units were recorded incorrectly on the original deeds of sale. As a result, some Tara owners are living in a property that is not the condo they own on paper.
And current owners must deal with the mistake before they can sell their condos.
TRG owner Homer Tyre said the issue came to light last year when his realty company handled the sale of a condo located in the 152-unit Tara complex, off Greenville's Charles Boulevard.
"When you sell a property, the attorney goes in to do a title search," Homer said. "They usually go back 30 years and check to see every time the property changed hands. They want to make sure there's nothing filed against the property by the previous owners.
"The title search usually is done at the last minute, to make sure a lien hasn't been filed."
After Greenville attorney Steve Jones conducted the title search for the condo, he discovered a discrepancy with the deed and title, Homer said.
"He was at the closing table and he circled the condo on the map and said, 'This is the property you are buying,' and the buyer said, 'No, we are buying this one.'"
The seller lived in unit C -- and the buyer had a contract to purchase unit C -- but according to the deed filed at the Pitt County Courthouse, the seller owned unit D.
How did this happen?
"With multifamily units, there's a building diagram from the preliminary survey of the property," said Tyre Realty Group agent Amanda Whited. "When the property was first purchased, someone turned the map the wrong way."
As a result, the deed was recorded incorrectly 12 years ago.
"A buyer bought the one in one corner, but according to the deed, he really bought the one in the other corner," Amanda said. "There was an initial human error when the complex was first developed and sold.
"It wasn't the seller's fault, and it wasn't the buyer's fault -- but the property couldn't change hands until the paperwork was accurate."
In order to resolve the issue, the owners of unit C and unit D each had to agree to sign a quick-claim deed, which transfers the property.
In this case, the owner of unit D now lives in a retirement community in Virginia -- and when he was approached by the attorney's office he thought he was being scammed out of his property, Homer said.
"They finally got this guy to sign the property over, but it cost us about 5 months delay in closing."
"We thought it was a fluke," Amanda added.
Until it happened again.
"A couple asked us to sell their Tara condo," Homer said. "We put it on the market and sold it in 2 or 3 months, put it under contract. We are going to the closing, and we are notified the day of closing that the deed is not correct. In the 11th hour, the seller gets notified that there is a problem with the deed.
"You've got buyers and moving trucks, ready to close. The buyer ends up renting the unit through the sellers so they can have somewhere to live and give us time to get this sorted out.
"This was in May or June, and it's now December and it still has not closed. The attorney can't get the other party to agree to deed over the opposite units to one another. The owner feels he is entitled to damages and he wants to sue."
To add to the problem, the attorney who filed the initial deeds has retired and, Homer said, "he has decided this isn't his problem any more. He is refusing to help the condo owners."
So, if you own a Tara condominium (or any condo, for that matter) and you plan to sell it in the near future, what should you do?
Contact an attorney to do a title search before you put the condo on the market.
"Pay $250 to $350 to a reputable attorney to do a full title search to make sure the deed and title are correct," Homer said. "They need to see it and verify it."
If there is a discrepancy, ask the attorney what must be done next.
"I don't want to get to the closing table and find out about this," Homer said. "The buyer can walk away.
"The seller needs to be pro-active. Do your homework up-front and go by the book.
"If you are even so much as thinking of selling in the next couple of years, I would want the peace of mind in knowing. It is not an overnight, easy fix. There is no one-size-fits-all resolution."
And what if you are interested in purchasing a condo?
"If you are a buyer, you need to be asking the seller if they have done a pre-search," Homer said. "If the seller is not willing to do the pre-title search, you should ask them to do that as part of the contract to purchase. The buyer should know before they pull up in the moving truck."
Homer and Amanda say they hadn't dealt with this issue before -- and had not been told about the problem at Tara.
"We have heard no communication from other firms and brokers about this," Homer said. "We think they are all oblivious to it."
The Tara condos were built 12 years ago and may have been sold a number of times -- without the discrepancy being discovered.
"There are some that are managing to get through the cracks that haven't been caught, and the new buyers are inheriting the problems," Amanda said. "There are attorneys not catching the problem and transferring the property illegitimately."
"It's just paperwork that's done wrong," Homer said.
"But it's a critical detail," Amanda said.
"It's going to have to be fixed so the property can be legally sold," Homer said. "And every instance is going to be different.
"We want to educate everybody about starting the process so fewer people are impacted by this."
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