Kailua, HI · Member since 2016 · 10 posts · 0 votes
I purchased a single family house in Montgomery, AL...on Ebay. The seller wasn't the original owner, he was reselling this property for someone else. After I transferred him the money for the property, he sent me a Warranty Deed along with the house keys. A few weeks later, after the deed was recorded, I was told that the legal description in the Deed is not correct. The seller did the closing without an attorney, so this mistake was made. After I talked to one of the local attorneys, they told me that I would not be able to re-sell this property due to an error in the legal description. What should I do?
I have no contact information of the original owner who could issue a corrective deed, so that's a deed end.
My plan was to rehab this house and rent it out, but not having a correct legal description in the deed makes me hesitant if I should even invest money in this property.
@Polina Kin, I am not licensed in AL so there may be laws that are different and my advice may or may not apply. If this was in my state the first thing I would is order a title insurance policy to check out if it is legitimately yours. If it showed clear title to the guy you bought it from then his contact info should be in the chain of title. Most states have laws that require the addresses be put on the deed. If not the tax notices must be sent somewhere and the local county treasurer should have the last address. If that fails there are Quiet Title actions. You are supposed to serve the other parties, but if you cannot find them you can publish your summons to them in the newspaper. The quiet title should fix the description defect. You need to ask a local attorney however as laws on property ownership are controlled by state law so they can vary a lot. Hope that is of some help @John Thedford
@Polina Kin. I was not aware you could buy houses on Ebay. Since you're from Hawaii, I'm guessing you didn't walk through the house. Are you even sure that the house exists and was actually for sale? Is it possible that the whole thing was a complete fraud? The rest of my questions are assuming (perhaps naively) that the seller acted in good faith, and did not disappear after your payment cleared.
You say the seller did this without an attorney. Did you not have a lawyer on your side, either?
Is the issue a technicality, or a completely fraudulent deed?
If you can't sell it with an incorrect deed, how could the seller sell it with the same deed?
What was the purchase price? What is the rehab going to cost?
How are you planning to rehab and rent from afar? Did you already have a contractor and manager lined up?
I guess what it comes down to is that you have to decide if you want to put the money in and rent it out with the hope that no one else comes to you and says its actually theirs.
Going off of what was previously said i seriously think you just got ripped off extremely hard. 1 why did you pay cash for a house and not do financing? 2 why did you buy the house on ebay site unseen? 3 why didnt you do your due dillegance on the property before buying?
@Polina Kin If this "reseller" has disappeared/is refusing to help, you should definitely call a lawyer/police. Interstate wire fraud is a federal offense. Sucks that it happened, but I hope the lessons learned on this are pretty clear for ya.
@Kevin Siedlecki . Yes, I wasn't aware until I saw a Real Estate section on Ebay. I was surprised at first, then I did some research, and found many success stories.
Yes, I bought it from Hawaii, but the Ebay listing had a lot of pictures of the property, so I had an idea what I was buying.
The house does exist, the deed is already recorded under my name. However, the deed has an error in legal description. I didn't have a lawyer on my side, I purchased it thorough an auction, so I didn't have time to have a lawyer to look at it.
This is issue of a technicality and in order to correct a deed I was told that both parties (grantor and grantee) have to sign a new corrective deed. However, I have no contact information of the grantor, I have no way of reaching him.
The purchase price was only $2.000, which is a great deal for this property even though it's a fixer-upper. The rehab would probably be around $15.000.
Yes, I was planning to have a property manager to take care of this property.
I'm hesitant to invest money to rehab this house since it has a bad legal description and I was told by an attorney that I will have difficulties re-selling it with this deed in the future.
If this auction was in good faith, then you should be able to get in touch with the Grantor through the middleman/wholesaler... I don't know what you want to call him... who listed it on Ebay. Has he not responded to that request?
@Jordan Sunshine . I bought it from an auction for a very low price. The purchase price was only $2,000, so I thought it was worth to take the risk. I did my due dillegance before bidding on this house, I made sure there were no taxes due and no liens on the property. Again, the property was so cheap so I thought it was worth the risk. Now the only problem is to correct a mistake in the deed which is already recorded under my name.
@Kevin Siedlecki . Yes! That would be the easiest thing to do. The attorney told me the same thing. However, I tried to contact the middleman, and he said that he has no way of contacting the owner. So it's a dead end and I will have to find a way to correct the deed on my own.
@Account Closed . Yes, lesson is definitely learned. However, the purchase price was only $2,000. The attorney told me that I can re-sell it using a Quit Claim Deed, that way he could prepare a document with a correct legal description.
However, not many buyers would want to buy a property with a Quit Claim deed....
@Polina Kin - gotta be honest. I've been trying to stay positive for you, but the very low purchase price and the fact that this guy now has no contact info for the original owners, and the whole thing was done without lawyers.... its becoming too obvious to hold out hope. I have to agree with the people above who think this was a scam from the start.
@Polina Kin, I am not licensed in AL so there may be laws that are different and my advice may or may not apply. If this was in my state the first thing I would is order a title insurance policy to check out if it is legitimately yours. If it showed clear title to the guy you bought it from then his contact info should be in the chain of title. Most states have laws that require the addresses be put on the deed. If not the tax notices must be sent somewhere and the local county treasurer should have the last address. If that fails there are Quiet Title actions. You are supposed to serve the other parties, but if you cannot find them you can publish your summons to them in the newspaper. The quiet title should fix the description defect. You need to ask a local attorney however as laws on property ownership are controlled by state law so they can vary a lot. Hope that is of some help @John Thedford
I've had a similar issue, lot numbers were wrong and I didn't catch it, but it was done by an attorney, and he simply filed a scriveners error affidavit. But, your case is different, no attorney was involved in the transaction. Also, most eBay real estate sales are somewhat of a scam.....usually some property they bought at a tax deed which does not have clear title, or some other issue that only a title search and zoning check will verify. Have a Real title search done, and check the land use before you throw good money after bad. If it was deeded in your seller's name, there will have been an address for him somewhere in the county land or tax records.
@Polina Kin what am I miss understanding? Are you saying you can't locate the grantor (owner)?
I went to http://revco.mc-ala.org/ a site (click on property tax left side) which lets you search for property in Montgomery Alabama. I did a random search of a street name and it pulled up several properties. Once I selected a property I could select a tax year and see the address of the person paying taxes. I would think this would be a starting point to locate the owner if the person isn't listed on the deed.
@Jerry W. , thank you so much for your reply. Yes, I've tried to purchase a title insurance policy, but the attorney with whom I talked to, said that I have to get my legal description corrected first before they can issue me a title policy. Tomorrow, I will try to get ahold of a different title company to see if they can help me to resolve a title problem and hopefully offer a title policy.
Yes, the contact info of the original owner is on the deed, however, they used an LLC, there is only an address, no phone number.
I understand that the laws may be different in Alabama, I will contact a local attorney to get more answers. Thank you so much for your great tips!
@Wayne Brooks , great point! I've read some articles related to this issue when mistakes in the deeds are made, and I'm hoping that an attorney will help me to file an error affidavit or offer another option which will not involve a court process.
Yes, I had a feeling that this property was bought at a tax deed, but I couldn't resist to purchase it because of how good the location is. But of course, I didn't expect this problem to happen.
Great advice about doing a title search...For some reason one Title company has already refused to give me a policy because of the error in my legal description. I wish I could just contact the grantor and have him issue a corrective deed, however I have no contact info of the grantor: he used an LLC, so there is only an address, I can't find any phone numbers...Dead end :)
@Account Closed , I already contacted the Ebay seller who sold me the property. I've learned that he was just a middleman, who most likely purchased the house from at a tax deed. He couldn't put me in touch with an actual owner, he claims that he has no contact of the owner whatsoever.
I'm not trying to file a claim against the seller because the property cost only $2,000, and even if I won't get the legal description fixed, I'm hoping to re-sell it and make a little bit of profit.
@Dan Mann ., Hi Dan! Thank you for your reply! Yes, I've already checkout out the Alabama Citizen Access Portal and typed a parcel number just to see who was paying the tax. There is a name, but when I Googled it, there were hundreds of the same names came up. The property is under an LLC and there is no phone number, only LLC address. If I was in Georgia, where the LLC located, I could probably show up and try to locate the owner, but I'm in Hawaii, and I feel like my hands are tied.
If the Ebay seller was truly just a middleman and didn't own the property, I would report him to the Alabama Real Estate commission for acting as a broker without a license. If he is a licensed agent then file a claim against him that way.
If he was selling a property that he did own (he was not just a 'middleman') then he should be ale to sign a corrective deed or is potentially guilty of fraud.
@Dan Mann ., Hi Dan! Thank you for your reply! Yes, I've already checkout out the Alabama Citizen Access Portal and typed a parcel number just to see who was paying the tax. There is a name, but when I Googled it, there were hundreds of the same names came up. The property is under an LLC and there is no phone number, only LLC address. If I was in Georgia, where the LLC located, I could probably show up and try to locate the owner, but I'm in Hawaii, and I feel like my hands are tied.
Polina, have you seen a deed for the property other than the one that he sent you? It's not a huge stretch for someone to forge one up, particularly with bad data to make it hard for you to actually verify all the info in it. You should be able to access the actual deed online or request one from the county, which should state who the owner is (hopefully that would be you). Whatever it shows for public access may not be up to date yet, but you should be able to find or request an actual copy of the most recent deed to the property. Personally, I've not been able to find your name on any properties in Montgomery county, AL, but that's assuming you purchased under your name and that it's updated for public access.
I know you mentioned that "it only cost $2,000" but you should file with Ebay to follow through with the erroneous deed. He maybe the middleman but he needs to be in alignment with state law. Additionally, you could also prevent this "middleman" for potentially targeting another buyer.
I believe members of bigger pockets are here to help other investors in multiple ways and weeding out those who try to scam people in real estate deals. Just my thoughts...
@Kevin Siedlecki . Yes, I wasn't aware until I saw a Real Estate section on Ebay. I was surprised at first, then I did some research, and found many success stories.
Yes, I bought it from Hawaii, but the Ebay listing had a lot of pictures of the property, so I had an idea what I was buying.
The house does exist, the deed is already recorded under my name. However, the deed has an error in legal description. I didn't have a lawyer on my side, I purchased it thorough an auction, so I didn't have time to have a lawyer to look at it.
This is issue of a technicality and in order to correct a deed I was told that both parties (grantor and grantee) have to sign a new corrective deed. However, I have no contact information of the grantor, I have no way of reaching him.
The purchase price was only $2.000, which is a great deal for this property even though it's a fixer-upper. The rehab would probably be around $15.000.
Yes, I was planning to have a property manager to take care of this property.
I'm hesitant to invest money to rehab this house since it has a bad legal description and I was told by an attorney that I will have difficulties re-selling it with this deed in the future.
NVM this post.. I missed your post about the eBay seller was wholesaling..
@Polina Kin I agree with Jerry W. that I would get a title company to look it over and see where they think the problem is and what rights the seller had to sell it to you in the first place. Then if it is truly just a minor issue with the deed I think a Quiet Title action would take care of clearing the title permanently.
I am actually local here in Montgomery, AL, and would be happy to look into it a bit if you would like. I could at least swing by the property to take a look at it. I also spend a lot of time tracking down people who are hard to find around here, so I might be able to come up with something. Just an offer. Let me know if you're interested in me taking a look at it.