Updated over 14 years ago on . Most recent reply
Tax Lien
Do you get the tax lien after or before putting a seller in a contract? The reason why I'm asking is because how do you make an offer on a property and put the seller in a contract and come to find out they have $50,000 tax lien that they dont know about?
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#3 Real Estate Deal Analysis & Advice Contributor
- Rental Property Investor
- Mercer Island, WA
That falls into the general category of title problems. The contract will say (or should) that the sellers must deliver a clear and marketable title. If they have a tax lien, or any other sort of title defect, they must clear it up. If they can't, they can't meet the requirement and there contract is void.
In a normal transaction, you would start the process by handing over your contract to a title company and they would start the title work. They would find this or any other problem. Since you're wholesaling, you may not do that right away. But you will do it at some point in the process. Best to learn how to do this sort of research on your own, or find a flexible title company that won't charge you if your deals don't close.