Sounds like the same as Ohio Mechanic's Liens. When we close we have the seller sign an standard "Owners'/Sellers' Affidavit" which states, among other things, that there hasn't been any work performed or materials furnished that have not been paid for. Though I have never been involved in a situation like the one described, I would assume that the title insurance policy the owners purchased would cover the claim and sue the seller for restitution. Just another reason why title insurance is still an important product.
As for the search, we do what Wendi described - if we find it we show it, but we don't make a practice of searching the names of the sellers after they have sold the property. Though as Kevin mentioned the Mechanic's Liens need to be filed within 90 days of completion of the work so there is a good chance it would be caught.
Excellent question. We need more of these type of questions on Source of Title. Thanks for posting it.
Best,
Robert A. Franco
SOURCE OF TITLE
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