Clouded Title On SFR

[Andy R.]

Hey All, 

I currently have my 2nd property under contract and expecting to close soon. Here is a situation we ran into.

Here are the details using different names: John is the seller and I am the buyer (this is in the state of Florida). Kate sold the property to John in 2004. 

Shelly was the only person on the deed since the property was built. In 2003 shortly after her husband died (who was never on the deed), she quit claimed the deed to herself and to one of her daughters, Kate. 

In late 2003 Shelly dies and in mid 2004 Kate sells the property to John (an unrelated buyer). Here is where we run into some issues. A death certificate was never recorded for Shelly with the sale of the property. There was also no joint tenancy with right of survivorship on deed. Technically, Shelly's next of kin owns the other half of the property. We know her husband died so it would go to her children, one of which is Kate. John has the title policy from the sale and the underwriter, Fidelity National, may be willing to re-insure the title (pending approval); explicitly stating on the new title policy that they are aware of this issue and if some heir where to come after the property they would be responsible. 

From what the agent at Fidelity National is telling me, this should give me the clear to close while having the protection that title insurance was designed for. 

BP, what are your thoughts on this?

Thanks!

[Frank Chin]

It seems that even with the title insurance there is still doubt, as evidenced they are "aware of the issue" and the question will be raised again when you sell the property. To clear it once and for all I think a "quiet title action" is in order to to be paid for by John's title company. Once this is recorded, then title should be all clear, forever.

[Andy R.]

Frank, thank you.