Deep dive into deeds

9 Replies

So I found a property that peaks my interest online and while reading the description I see “Property is being sold as is and will be sold with a QUIT CLAIM DEED ..title needs to be quieted”. I sent and email asking for the reason to the quit claim and his response was “The house was originally purchased at the tax sale which is why it needs to be quieted”. Can anyone give me a little clarification and advice on how to peruse this deal?

Help me BP1 Kenobi your my only hope

Thanks a bunch

Originally posted by @Gabriel Medina :

So I found a property that peaks my interest online and while reading the description I see “Property is being sold as is and will be sold with a QUIT CLAIM DEED ..title needs to be quieted”. I sent and email asking for the reason to the quit claim and his response was “The house was originally purchased at the tax sale which is why it needs to be quieted”. Can anyone give me a little clarification and advice on how to peruse this deal?

Help me BP1 Kenobi your my only hope

Thanks a bunch

A tax sale "clouds" or taints the title chain and as a result of that "cloud" title insurance companies will not insure a property bought at a tax sale unless the title is "quieted". The title is "quieted" through the courts and is a process that certifies that the tax sale was done according to law and that the former owner was given the chance to recoup their property as per the laws of the state.  Quieting the title removes the cloud and the property can be sold.

It usually is cured by a quiet title action......but have thorough title search done prior to make sure, which will involve looking at the tax collector files in regard to the tax auction.

@Ed Mayo  @Wayne Brooks . Thank you for that clarification and advice, that makes sense to me. I called an attorney this morning and they said that a title search would be $350. I don’t want to pay for a title search that tells me not to move forward with this property. What is the best course of action in the pursuit while not wasting money and protecting myself from future unwanted surprises? Again thank you guys so much.

A quiet title action takes a long time (months). If you're not willing to spend $350 on the title search, I think that you should move on and find something different. Properties have all sorts of issues when they're acquired and title issues can be among the most serious as they can prevent you from carrying out your plans. 

I (myself) would never buy a property with just a quit claim deed. All that gets you is that the person that issues it is providing you with whatever interest "they" have in the property. There could be other owners. There's a lot of properties out there, find one without the issues unless this is such a good deal you're willing to jump through all the hoops and accept the risk for the potential upside.

I would say this deal is an infield double, which is not a home run. But with the me being so new to the game I’m really trying to gain knowledge. Like what are the hoops? What are the risks? How long does a title search take? Do people write contracts with contingencies about the results of a title search? I’m willing to accept the risk of wasting my time but I’m not in the position to waste capital at this point. 

Sign a contract with 7 days “due diligence” contingency.... cancel if title search reveals other issues. 

We have no idea what state this in so no way to know if there is a redemption possibility, liens that stick in a tax suction, etc. 

a Local real estate attorney or title company is your best bet. 

Or.....just buy it and see what happens. 

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