Title Defect

Legal claim, circumstance, or other condition that makes it difficult to identify the true owner of real property or transfer title to another. It is also called a Cloud on Title or clouded title, as when ownership has not been recorded properly, or when secondary liens have not been removed after the obligations have been paid. See also Title Insurance; Title Search.

An unresolved claim against the ownership of property that prevents presentation of a marketable title. Such claims may arise from failure of the owner's spouse, or former part owner, to sign a deed, current liens against the property, or an interruption in the title records to a property. See Cloud on the Title.
Example: Prior to the closing, the attorney for the title insurance company discovered a title defect that delayed the transaction. It seems the property had once been owned by the seller's parents and a deed had never been signed over to the seller.