What is a title search and why is one required by a bank?

A title search is prepared by our office in order that we may certify/insure to the bank that the title for the property in question is good and marketable. One component that we check is to make sure that all liens of present and past owners have been satisfied of record. However, there are many other important aspects that are considered when determining if a title to real estate is good and marketable. One that is frequently of concern in Perry County is whether legal access exists to the property. That is always critical when a property does not border a public road.

If my property does not border a public road why does it matter if no one is preventing me from using the existing roadway to gain access to my property?

A property that does not have a valid right-of-way is generally considered by a bank to be a credit risk and many banks will not loan money to the homeowner using that property as collateral for a loan. Additionally, when a property is placed for sale, properties without valid rights-of-way are not as marketable.

How can I find out if my property has a valid right-of-way?

Under Pennsylvania law there are several ways a right-of-way may be acquired. Our office can examine the title in the courthouse, review applicable records and determine if a valid right-of-way exists.

What if we cannot prove that I have a valid right-of-way to my property?

In the event that a valid right-of-way cannot be established, our office will assist you in attempting to negotiate an agreement providing access to your property.

Why do I need to have an attorney attend settlement if I bought my property through a realtor?

The answer to that question can best be answered by understanding the difference between the roles of the realtor and the attorney. The realtor's job is to help you find a suitable property. The attorney's job is to make sure that if you acquire the property selected, you will obtain good and marketable title and to insure that your real estate settlement is handled in accordance with established legal principles.

What is the difference between a will, power-of-attorney and a living will?

Under Pennsylvania law, all three documents serve different purposes. A will is a document that addresses issues regarding your estate once you are deceased. It does not control matters of importance while you are alive. Property management (business) and health care power-of-attorney are documents that govern how your legal and health related affairs will be handled while you are alive. If you are not able to make the necessary decisions regarding your legal and/or health care related affairs, it is critical to have a person appointed to handle those matters for you. A living will is a document that allows you to make certain health related decisions if you are in an end stage medical condition.

Can I wait to have a power-of-attorney prepared?

The answer to that question can best be illustrated by my personal example. My wife and I went out to dinner several years ago and were in a terrible automobile accident caused by a drunk driver. If I had waited to have prepared a power-of-attorney, my wife would not have been able to have handled matters that required her attention on my behalf while I was in critical condition. Another example is that if a person has a debilitating medical condition such as a major stroke, that person may have waited too long to have executed a power-of-attorney because Pennsylvania law requires that the person must be competent at the time they sign a power-of-attorney. If a person is not competent to execute the power-of-attorney, the only alternative is to have a guardian appointed and that process is lengthy and very costly.

What if I do not have a will and pass away?

Under Pennsylvania law, the state has passed laws that controls how your estate will be distributed if you do not have a will. That law does not take into consideration what the decedent may have wanted to have done, who he/she wanted to receive a portion of the decedent's estate or what church or charitable organizations the decedent may have wanted to benefit.

What assets do Pennsylvania tax when a person passes away, and how much tax is owed?

Pennsylvania does not have a threshold. By that I mean that Pennsylvania taxes all reportable assets less certain allowable deductions. In Pennsylvania we have four rates of tax and they are dependent upon the relationship between the decedent and the beneficiary. Transfers to a spouse, church or qualifying charitable organization are taxed at the rate of 0%. Transfers to parents, children and grandchildren are taxed at the rate of 4.5%. Transfers to a decedent's siblings are taxed at the rate of 12% and transfers to anyone else are taxed at the rate of 15%.

What types of assets are not subject to Pennsylvania inheritance taxes?

In Pennsylvania there are very few exceptions to what is taxable. Life insurance proceeds are not subject to inheritance tax. Gifts that were made by the decedent at least one year prior to the date of death are also not subject to Pennsylvania inheritance tax. IRA's and 529 accounts are also not subject to Pennsylvania inheritance tax under some circumstances. Property owned jointly with another individual is partially exempt from inheritance tax. If a person transfers his/her property but keeps a life estate, the retained life estate is fully taxable under most circumstances.