We are often asked what is the difference between a normal title search and a municipal lien search. This question has even more relevance as the turnaround times for municipal lien searches have grown longer, and are far greater than the 24 to 48 hours it takes to obtain a typical title search. This is particularly important when it comes to “rush” transactions, where there may be insufficient time to complete a municipal lien search. As such, it is important to understand the distinction and the timeframes to complete this research.
A typical title search involves a search of the public records to determine ownership of the property, and what recorded instruments may or may not impact title. It also provides a roadmap for the closing agent to resolve issues that might impact title to the property. A municipal lien search is defined more narrowly in the standard contract to mean “a search of the records necessary for the owners policy of title insurance to be issued without exception for liens imposed pursuant to Chapters 159 or 170, Florida Statutes, in favor of any governmental body, authority or agency.”
So what does this mean in English? Essentially the lien search is performed to discover if there may be unrecorded issues with the property that may pass to a buyer (as opposed to a traditional title search, which identifies recorded issues that are more easily discovered). A typical municipal lien search involves research into three areas that a typical title search does not cover: (a) unpaid utilities, (b) code enforcement issues/violations, and (c) permit issues. Since those are not discovered by a traditional title search, and they must be researched generally by contacting the local municipality.
Why is this important? Because unpaid utilities, code enforcement violations, and/or permit issues can result in massive financial exposure to a buyer, and a prior owner’s property related problems will run with the land. In other words, a buyer of property inherits these issues and they never go away until resolved. And since the law (i.e. Sections 159 and 170 of the Florida Statutes) do not require these issues to be recorded in the public records until a municipality feels like it, if a municipal lien search is not performed, a Buyer could inherit these issues without ever knowing they did so. As such, it is vital that this research be performed. More often than not, this research uncovers issues that must be resolved.
The problem is that this research is fairly time intensive, and requires multiple calls to multiple local agencies, many of whom do not have the resources to turn this research around quickly. The following chart lists the turnaround times for certain municipalities (pay particular attention to Sarasota and Manatee Counties, and note that these are BUSINESS DAYS):
County Municipality MaxTurnaround
Charlotte Charlotte County 4
Charlotte Punta Gorda 6
Manatee Anna Maria Island 4
Manatee Bradenton 8
Manatee Bradenton Beach 4
Manatee Holmes Beach 4
Manatee Longboat Key 6
Manatee Manatee County 12
Manatee Palmetto 4
Sarasota Longboat Key 6
Sarasota North Port 10
Sarasota City of Sarasota 7
Sarasota Sarasota County 16
Sarasota Venice 1
So if you need to complete a rush closing and your property is in any of these municipalities we strongly urge you to consider these timeframes when establishing a closing date. And if your parties must close before this research can be completed, then we strongly encourage you to have your buyer contact their real estate attorney to discuss the risks. And as always, should you have any questions, please reach out to your trusted real estate lawyer.
Berlin Patten Ebling, PLLC
Article Authored by Evan N. Berlin firstname.lastname@example.org
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