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Tax, SDIRAs & Cost Segregation

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Michael Finkelshteyn
  • Wholesaler
  • Houston, TX
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73
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Clearing title with dead trustees and heirs

Michael Finkelshteyn
  • Wholesaler
  • Houston, TX
Posted Feb 7 2016, 20:23

I've been working on a deal in Texas that seems to have reached a dead end and I don't know what else to do. 

I was contacted by the seller who did not know if he had equitable interest in the house due to the situation below.

Situation:

  • Mom and Dad place house into revocable trust via quit claim deed (recorded). Mom and dad are trustees.
  • They had two children; son and daughter (wife to seller).
  • Dad passes away. No record of probate or recorded will.
  • Some time later, mom deeds property to daughter (seller's wife). This was recorded
  • Mother passes away. No probate
  • Daughter passes away. No probate, there is a signed will, however it was not notarized or recorded.
  • Daughter and seller had a daughter. She married and had two kids (currently minors).
  • This daughter passes away and is survived by husband and her two kids.
  • No probate nor will.

Issue

  • Original trust document is missing, no one seems to have a copy
  • I've spoken with two title companies and they will not close without the trust document

Secondary Issue

  • Current occupants may need to be evicted
  • Many years of back taxes owed
  • The seller has received some communication with the attorneys dealing with tax foreclosures, but I do not have enough information about that.

What I've Done so Far

  • I have spoken with two title companies and received title commitment stating that they cannot move forward without the trust document
  • I have spoken with a real estate attorney about doing a quiet title and they seemed a bit apprehensive due to the amount of time this could take
  • I have spoken with the son to Mom and Dad (deceased trustees) 
  • I have spoken with the husband to the seller's deceased daughter
  • I reached out to the attorney who wrote up the trust and the notary. I found them through the quit claim deed.
  • Attorney did not have a copy of the trust and could not provide any more information.
  • Notary did not have a copy of any documentation from that transaction. 

There is significant amount of equity in this deal. Performing quiet title is still doable, provided that attorney fees do not escalate beyond 20k-25k

I am at a dead end and not sure what I should do at this point.

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