Title Insurance vs. Quiet Title

[Brittany Wilkerson]

Hi, everyone. Does title insurance sort of serve the same purpose as a quiet title action? Would a quiet title really be necessary if you have a tax deed and the tax sale is valid? I had purchased a course and it came with some really helpful templates to file the quiet title, but I'm not sure if I really need to. 

[Roy Oliphant]

Quote from @Brittany Wilkerson:

Hi, everyone. Does title insurance sort of serve the same purpose as a quiet title action? Would a quiet title really be necessary if you have a tax deed and the tax sale is valid? I had purchased a course and it came with some really helpful templates to file the quiet title, but I'm not sure if I really need to. 

Hi Brittany,

I assume you are asking regarding an Alabama property.  Tax sales are very different by state and you need to get state specific answers.  Best person for Alabama is @Denise Evans  She can give you the best answers. 

In general terms, Quiet Title and Title Insurance serve two different purposes.  Quiet Title is a process (usually via the courts) that works to remove claims that others may have on the property.  In Alabama Tax Sales it is necessary to remove any claim the previous owner may have to redeem or reclaim the property.  It is usually required before any company will issue Title Insurance which is a company's warrant that they have inspected the title and believe it to be good and will pay up to the policy amount if there are any successful claims against the title, subject to their limitations.  

As an investor, you need to get Quite Title so that you have uncontestable ownership.  You would not usually get Title Insurance until you sell or borrow against that property.