What Should Buyers Look for in a Title Report Before Closing?

Buyers should review the title report for outstanding mortgages, liens, open notices of commencement, and exceptions to coverage before closing on a property. In Florida, the title commitment breaks down into three sections: Schedule A (property and ownership details), Schedule B-1 (requirements that must be cleared), and Schedule B-2 (exceptions the policy will not cover). According to Florida title industry data, mortgages and construction-related liens are the most common issues that appear. The good news? Your closing agent's entire job is to resolve these problems so you walk away with clear title.

How a Florida Title Commitment Is Structured

Before you can spot problems, you need to understand the document itself. A title commitment is the report your closing agent or title company produces after searching public records tied to the property. It tells you what needs to happen before the title insurance company will issue a policy. Every Florida title commitment follows the same three-part layout.

Schedule A – The Basics

Schedule A is the cover page. It lists the effective date of the policy, the dollar amount of coverage, the names of the insured parties, the current property owner, and the legal description of the land. Buyers purchasing homes in Palm Beach County or Broward County should double-check that names and legal descriptions match the contract exactly. Even a small typo here can cause delays at the closing table.

Schedule B-1 – Requirements to Clear

This section lists every task that must be completed before the title company will issue insurance. Common requirements include paying off existing mortgages, recording a new deed, satisfying tax balances, and releasing judgment liens. If any single item on this list remains unresolved, the closing cannot move forward. Think of Schedule B-1 as a to-do list that protects your ownership rights.

Schedule B-2 – Exceptions to Coverage

Schedule B-2 spells out what the title insurance policy will not cover. These are called exceptions. Typical examples include utility easements, restrictive covenants from an HOA, and rights of parties currently occupying the property. Buyers should read every exception carefully. An easement for a power line through the backyard might be acceptable. However, an unrecorded lien or access restriction could affect how you use the property down the road.

Common Title Issues That Surface Before Closing

Most title commitments are not squeaky clean on the first pass. Several issues tend to show up again and again across South Florida transactions. Here is what to watch for and why each one matters.

Outstanding Mortgages

The most frequent item on a title commitment is a mortgage. Sellers often carry a remaining balance from years ago. Maybe they bought the home 20 years back with a $500,000 loan and still owe $250,000. The closing agent will order a payoff statement, collect the money from the seller's sale proceeds, and satisfy that mortgage at closing. This process happens behind the scenes, but buyers should confirm it appears on Schedule B-1.

Liens on the Property

Liens come in many forms. Municipal liens can result from code violations that turned into fines. PACE liens are tied to energy improvements like solar panels. Contractor liens stem from unpaid construction work. HOA liens pop up when association dues go unpaid. Each type must be cleared before the title company will issue a clean policy.

As Larry Mastropieri explained on the Discover South Florida Podcast:

"There are municipal liens from code violations that turned into fines. There's PACE liens from solar panels. There's many different types of liens. It's our job as the closing agent to clear those title issues out so that the buyer is getting clear title."

Notices of Commencement

A notice of commencement is filed whenever a property owner hires a contractor for work. Maybe the seller added a screen porch, replaced the roof, or put up a new fence. Once the work is done, that notice needs to be formally closed out. Contractors almost never handle this step on their own. The result? Open notices from projects completed years ago still sitting on the title.

As Larry Mastropieri,

"Contractors rarely if ever close those out. It's very annoying from a title closing agent perspective. It's our job to chase down these contractors from three years ago, five years ago, and get them to sign the necessary documentation, including an affidavit that there's no amounts due and owing."

Code Violations and Open Permits

Expired or open building permits and unresolved code violations also appear on title searches. A seller who remodeled a bathroom without pulling permits could leave you holding the bag. The closing agent works with the city to confirm whether violations exist and what it takes to resolve them. In some cases, money is held in escrow after closing to cover the cost of clearing these items.

Here are the most common title issues South Florida buyers encounter:

• Seller mortgages with outstanding balances that must be paid from sale proceeds at closing.
• Municipal liens from unpaid fines or code enforcement actions recorded against the property.
• PACE liens attached to solar panels or other energy improvement financing on the home.
• Open notices of commencement from past contractor work that was never formally closed out.
• Expired building permits or unresolved code violations tied to unpermitted renovations.

The Closing Agent's Role in Clearing Title

In Florida, the closing agent is typically a title company or a real estate law firm. Their job is to make sure every requirement on the title commitment gets resolved before you sign. Buyers working with a real estate agent in Boca Raton or anywhere in South Florida can rest easier knowing the closing agent handles the heavy lifting.

Larry Mastropieri explained,

"When a buyer is choosing us as the closing agent, they don't need to be worried about anything because it's our job to make sure that the buyer is getting clear title. They can rest easy knowing that we are going to give the buyer clear title."

Realtors play a key role here too. On the listing side, the agent works with the title company and the seller to address each issue that pops up. The realtor, the closing agent, and the seller all coordinate to get everything cleared. Otherwise, the title company cannot issue insurance, and the deal stalls.

When a Title Issue Can't Be Resolved Right Away

Not every title problem gets wrapped up neatly before closing day. Some issues take extra time, creative solutions, or both. The approach depends on whether a lender is involved and how willing all parties are to negotiate.

Lender Requirements vs. Cash Buyer Flexibility

A lender will not approve a closing if there is an unresolved title issue. Period. The bank receives a lender's title insurance policy, and they expect it to be free of problems. If a notice of commencement is still open because the contractor went out of business, the lender will hold up the deal until a solution is found.

Cash buyers have a bit more flexibility. They can technically accept an exception on their owner's policy and close with a known issue still outstanding. However, most buyers do not want any cloud on their property. Nor should they. A cloud on title could create headaches when it comes time to sell or refinance later. About 99.9% of the time, closing agents are able to clear everything before the deal closes.

Escrow Holdbacks as a Solution

Sometimes the best path forward is to close the deal and hold money in escrow to cover an outstanding issue. This works well for things like code violations or open permits that require city involvement. The closing agent holds back a set amount from the seller's proceeds. The seller then clears the issue after closing. Once resolved, the funds are released.

As Larry Mastropieri explained on the Discover South Florida Podcast:

"Sometimes we will close on a property and hold money in escrow to clear out some sort of code violation or open expired permits. We hold back money from the seller. The seller can clear those out post-closing, and that way the deal can close on time and the parties are happy."

This approach keeps the transaction on schedule while still protecting the buyer's investment. Time helps solve many title problems. An extra 30 or 60 days post-closing often gives sellers the window they need to get permits closed or violations resolved through the city.

Protect Your Investment With the Right Team

A title report is not just paperwork. It is the document that tells you whether you are about to own a property free and clear, or inherit someone else's problems. The right closing agent, paired with a knowledgeable real estate agent in Palm Beach County, makes all the difference. Review your title commitment early, ask questions about every item on Schedule B, and make sure your team is on top of each requirement before closing day.

If you have more questions about title reports or the closing process in South Florida, talk to someone who works this market every day. Reach out to The Mastropieri Group, Realtors®. Call (561) 544-7000 for a straight answer.