California county Tax Sale/auction

4 Replies

Hello! My county has a tax sale coming up and I'm trying to do my due diligence and learn more about the process. I have received conflicting information about whether it is necessary to get a title report for a property I plan to bid on. After my several hour of research, it appears as though risk is lower for tax sales, than trustee sales, since mortgages do not get transferred to a new owner of tax sale property. It appears as though I need to be most worried about local government fines (building code fines...etc). 

My local title company suggested I talk with the company Tax Title Services. Once a property is won at auction, TTS claims to provide "Due Diligence Certificates", and then partner Title companies will provide title insurance, within about 60 days. These properties can then be re-sold like any other property (no need to wait 1 year for a "Title Tax Certificate" or 5 years to be eligible for regular title insurance). The representative at TTS had the opinion that there are very few/unlikely situations where a investor would lose considerable amounts of money from liens that had not been cleared.

Our county is a "closed" county for title companies, meaning there is only 2 companies who perform title searches, and they are both backlogged several weeks. So, there is no way to do a title search before the auction. 

Anyone with considerable experience with California county tax sales? Anyone with conflicting info? Thanks

Hello Jeff and glad to see you hsve interest in tax deeds. The TTS will chevk to makr sure intersted parties were notified to the tax auction. You don't want to do repairs and have some coming later stating they have rights to the property. Question are you stufing from any tsx trsining sites? There a some sites iut there that can help better understand the tsx deed and tax certificate. I personally follow 5 different site. Esch one can show you something new.

Don Enrique

skype: don.enrique46

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@Jeff Macdonald Most of the counties in California will show on their auction listing whether or not there is an IRS lien against the property.  Once you have researched the property on the treasurer-tax collectors website you will be able to see whether or not there are code enforcement liens or water sewer bills, weed abatement fines, etc. that will go along with the property once you have acquired it.  You can call the recorders office to see if there are any other outstanding liens against the property if need be. Netronline is a good resource to get to the recorders office.  Once you have acquired a property there is a one year litigation period that the property owner has to contest the auction win at court.  There are erroneous sales that happen occasionally and the suggestion is that you don't sell the property for one year or during this litigation period so that the title can be completely cleared.  Once the year has passed then you will be able to get title insurance or you can quiet the title which will allow you to gain title insurance once this has happened. It can be very competitive and emotional and it is important to set your ceiling as to the amount you would be willing to pay for the property and stick to it. Good luck with your bidding and I hope you are successful with your endeavor. 

Due diligence is what you perform on a particular opportunity (hopefully, prior to committing your money).

Education is what you invest in long before the money goes hard.

You can learn to do your own title searches, and do so efficiently, for free at the county recorder's office. 

I recommend taking Ward Hsnigan's Title Research training in San Diego. Once you understand how matter affecting title are researched and chained out and have practiced this skill, you can bypass much if what title companies would otherwise do. And, abstract the owners and liens for free IF you are willing to spend your time.

Most people will wince at the idea and lose interest once they hear that they'll have to physically drive to the recorder's office since much will not be online. Thank you lazy-bones because they leave money of the table (and occasional pick up pennies and nickels when they bid on properties blindly).