I was looking to wholesale a vacant property that I got under contract with a motivated seller that lives 4 hours away from the property. The seller acquired the property on a tax deed auction sale several years ago and now they are looking to sale. I got the property under contract for a great price. I turned in my contract to my title company for a title search. I got a call from my title company saying that they cant issue a clear title, do to it having a tax lien on the property and the tax lien holder is now deceased and didn't sign over their rights before they had past. I had told the seller this information and they are really trying to get rid of this property.
The property is not in terrible condition at all, it needs minor repairs and a good clean up. The home is the only vacant property on the block. I would be interested in investing into this property for my rental portfolio.
Can the seller and I , structure a seller financing deal on this property that doesn't have a clear title? Can we do a loan term that is over 30 years? A term that is infinity?
I know that I may not ever be the "owner" of the property but I feel like I can get a good cash flow out of it for many years to come. I am curious to know. If anyone has any advice or knowledge on the matter please feel free to share.
In most jurisdictions you don’t pay the tax lien holder directly, you pay the taxing authority. Otherwise you could get seller financing, it makes no sense to want an “infinite” term as you’d never pay it off. You could figure out how to pay off the lien within a year or two.
I don’t know squat about the idiosyncrasies of La tax sales. So take what I say knowing that. You say that the seller got the property at a tax deed sale. La doesn’t have tax deed sales. Maybe he got the deed after tax lien redemption period passed? You say you can’t get clear title from title company because of tax lien. Is it because it has a tax lien on it now (because your seller didn’t pay new taxes) or they won’t give you title insurance because the title isn’t clean because of the previous sale? If it has a tax lien on it presently and if it’s not past redemption, pay it off. You’ll still need to Quiet Title it. If tax lien is past redemption then your seller may not own it anymore.
Don’t know if I was any help. I took a shot at it.