A Nevada buyer's purchase contract requires a 'clean title' at closing. The title search reveals a $15,000 mechanic's lien from a prior contractor. What typically happens?

Explanation

A purchase contract requiring 'marketable title' or 'clear title' obligates the seller to deliver title free of undisclosed liens and encumbrances. If a mechanic's lien is discovered during title search, the seller must resolve it — typically by paying it off at or before closing (often from sale proceeds). If the seller cannot clear the lien, the buyer may have grounds to cancel the contract. In Nevada, mechanic's liens (NRS 108) are common in new construction and remodel transactions and must be carefully tracked by title companies.