Escrow & Title
In Texas, a title company that discovers a discrepancy in the legal description of a property during a title search must:
AIgnore minor discrepancies to complete the transaction on time
BIdentify the discrepancy, note it as a title exception, and/or require correction before issuing coverage✓ Correct
COnly disclose the discrepancy if it affects more than 10% of the property
DReport the discrepancy to TREC
Explanation
When a title examiner discovers discrepancies in legal descriptions, gaps in the chain of title, or other title defects, the title company must note these as exceptions in the title commitment and/or require corrective action before agreeing to insure. Insuring over known defects would expose the title company to liability.
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