Galesburg, IL · Member since 2017 · 6 posts · 0 votes
A neighbor is behind on his taxes for the past 3 years and haves 2 weeks to redem the property. He said he will sell the property if i pay for the back taxes. The building needs a lot of work and he just wants to move out. The property was giving to him and haves a quite claim deed. My question is could i refinance the property with a quite claim deed after fixing the property ?
Investor · Scottsdale, AZ · Member since 2016 · 1k+ posts · 885 votes
9y
A Quit Claim Deed simply says he doesn't claim any interest in the property. It does not mean that he owns the property and nor does it mean he has the right to sell it. A Warranty Deed says that he will back you up in court if there ever is a problem.
I can give you a Quit Claim Deed to the Sears Tower because I don't have any interest in it. But, it doesn't do you any good.
A Quit Claim Deed is usually used to add a spouse to ownership on a property after funding if the bank is only considering one person's income for the loan and is used to add someone after marriage.
I think you want to do a Subject To which puts you in a position of ownership or maybe a Lease Option that POTENTIALLY puts you in a position of ownership to protect your investment of paying off the back taxes. There are other obvious issues that you don't seem to know the questions to ask. What you want to do is complex, so get some assistance.
The simple answer to your actual question is "probably not".
Investor · Greer, SC · Member since 2014 · 13k+ posts · 17k+ votes
9y
Jose,
Ken is correct about the QC deed. I didn't see you mention a mortgage just back taxes. If there is a clean General Warranty or special warranty prior to the QC deed then yes you could do a cash out refi after you fix up the property. You might want to have a title search done to make sure there are no issues. I would have sign over the property before paying off the back taxes.
Galesburg, IL · Member since 2017 · 6 posts · 0 votes
9y
thanks Guys!!! I'm new to this so I appreciate your feed back. Could I go to the court house to see if he haves a warranty deed or do I have to do a title search. He said that the property was giving to him about 5 years ago.
Wholesaler · Lehi, UT · Member since 2015 · 333 posts · 144 votes
9y
@Jose Vargas If you have him quit claim deed the property to you it make sure it is recorded with the county recorder's office to make sure you have it in your name. Check the records first for any and all outstanding liens against the property such as IRS, or any other special assessment liens that don't go away if you have the property quit claimed to you. After that you want to make sure that you pay the taxes prior to the sale so you don't lose it either. Once you have recorded the deed and paid the taxes you may want to quiet the title with a lawyer to complete the process. You can quiet the title and also get title insurance.
Title Representative · Indianapolis, IN · Member since 2016 · 64 posts · 41 votes
9y
There are countless red flags to the transaction you are getting involved in. I would have an attorney or title company run a search report which will provide you with the current owner of record and a list of any/all outstanding encumbrances on the property. In additional to acquiring back taxes, you could be acquiring federal tax liens, mortgage, foreclosure, etc. Keep in mind, redemption amount is not necessary the back tax amount. Contact the County Auditor/Treasurer for that figure before transferring any ownership.
As @Dustin Haviland pointed out, your title company can help with the chain-of-title questions, including how to get to a point where you can ultimately convey a warranty deed to a buyer. Knox County should be able to help you answer the questions Dustin mentioned.
Galesburg, IL · Member since 2017 · 6 posts · 0 votes
9y
Thanks Ken Min, John Underwood, Josh Carr, Elbert Madison Jr, Dustin Havilland, David Dachtera & Jeff B. for ALL of Your Information and time to respond to my post. I am a new member to Bigger Pockets and I Thank God for Josh & Brandon for creating this wonderful website.