Quitclaim Deeds

[Brittany Bolling]

Just a quick question do cash buyers mind purchasing a house that is a quick claim deed? I have several but been having a little trouble getting them sold

[Jon Holdman]

Its impossible to get a true "general warranty deed" on a REO. At best you'll get a "special warranty deed" (or, its equivalent in your area.) A general warranty deed say "I fully transfer all ownership of this property to you and guarantee that I can actually do that. You can sue me if there is ANY problem." A quit claim deed means only "I'm giving you whatever ownership I have in this property. I make no claims at all about whether or not I actually have the right to do that. You're on your own". A special warranty deed is usually what the banks give and it is in between. "I'm giving you the ownership I have and I really do have some ownership and will guarantee what I have. But there may be other issues I'm unaware of and I won't make any guarantees about those."

This junk properties are being dumped by banks who just want them to go away. These quit claim deeds may be worth something, but these properties likely have other stuff, tax bills in particular, attached to them. Your potential investors know that if they buy them they will have a mess they have to clean up. So, the value is significantly less than if the property were being transferred with a better deed. If you're just looking at the property and trying to determine a value, you're going to overvalue what the investor is actually buying. If, OTOH, you buy these properties very cheaply, go through the effort of finding and fixing these title issue and then sell with a better dead and title insurance, you will have added some real value.