When researching the title of a prospective tax deed property, how far should you go back? For example: The current owners bought the property in 1985, through standard closing with title insurance issued. Is there a need research chain of title further, or is ok to "ASSUME" that title is clear prior to the 1985 sale, because title insurance was issued?
First, full disclosure, I am not a title insurance agent, lawyer or anyone in the legal RE profession. That said here is what I do know.
1. The purpose of title insurance is to protect you against problems from the past.
2. If you are buying property your title insurance company will handle researching the history of the title to the property.
Now I may not understand the nature of the question since it is possible you are purchasing this property via non traditional means. So get a title insurance company to research the property for you. Then if something should come along that company will pay your legal fees and if a court rules against you the title insurance company pays you.
In other words, don't attempt to search a title yourself and never assume anything with RE and money,
Thanks Robert! I'm just doing a but of preliminary title searching, to see if a property/properties that have been foreclosed by the county for auction at a TAX DEED auction, is a good candidate/investment. My plan (common to tax sale investing) is to do preliminary title search myself and then if I have narrowed down to 1-3 properties, then pay abstractor to title search before bidding/interesting.
So any tax deed investor's have experience/advice n this topic? Since in cost $50-100 to have title search and would possible only take me another 10-20 at County to do additional preliminary research. Want to do all due diligence w/ research, just want to make sure I'm investing time/$ in the right places.
I typically go back at least 40 years or 3 transfers, which ever is longer. Around here it is common to hold a property for 20+ years, so I will still go back and verify there isn't anything wonky going on. If something seems amiss I will continue to dig, as the process does not take long.
I did a preliminary title search on a property where it was quit claimed back and forth between family members every 3 years for the last 30 years or so, but had been in the same family for about 50 years. I went back longer just to make sure there was a legit warranty deed in there somewhere.
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