NEED EXPERTISE PLEASE! TAX DEED SALE!

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NEED EXPERTISE PLEASE! TAX DEED SALE!

Daniel Miller
St. Petersburg, FL · Member since 2012 · 173 posts · 44 votes

I am currently under contract with an individual who purchased a property, via Florida Tax Deed Sale, less than three months ago.

I have looked up the county records and he did actually purchase it from the county. I just received an e-mail back from the title company stating that they cannot grant title insurance on the property because he has not filed a suit to quiet title. He can either file the suit to quiet title or wait four years to make this property eligible for title insurance.

I am having one of my friends (a woman at a closing agency) dig into this and see if there are any existing liens, encumberances, etc.

He does not want to do that. Also, he will only sell through a Special Warranty Deed. I understand that MORE THAN LIKELY everything would work out but I am not willing to take that chance.

What would your next move be? I want the property and am willing to work with the seller.

Should I go through and purchase the property and file a suit to quiet title myself (I will take $5,000 off the purchase price or negotiate something like that)

Should I attempt to force the gentleman selling the property to file a suit to quiet title?

I am uncomfortable because I have no recourse against anyone who owned the property before this previous seller.

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Matt Devincenzo
Investor · Clairemont, CA · Member since 2011 · 3k+ posts · 2k+ votes
12y
Originally posted by @Daniel Miller:
E-mail from agent...

Hi Dan, I am also working on this for you as well....My title company is finding out what to do. You will have to do suit for quite title after you own the property.

My understanding is that because Regions did not pay taxes the property was legally sold and they no longer have a lien on the property. I will also check with a Real Estate broker I know that does this all the time.

Talk to you soon.

I don't think that is an accurate statement. The truth is that it depends on if they were properly notified of the sale, if they weren't then they can prevail in the suit. That is why they require the quiet title prior to issuing title insurance.

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  • Richard D.
    Investor · Fort Worth, TX · Member since 2013 · 309 posts · 150 votes
    12y

    Daniel, the bank has no claim to the collateral of the loan. They still can however file a civil suit against the person who lost the home for breach of contract.

    They are probably trying to get you to bite on a loan for nothing in return.

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  • Wayne Brooks
    Real Estate Professional · West Palm Beach, FL · Member since 2012 · 23k+ posts · 13k+ votes
    12y

    @Daniel Miller 

    Actually wrong.  They have first claim to any surplus funds form the tax deed sale, above the minimum bid/taxes owed.

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  • Daniel Miller
    OP
    St. Petersburg, FL · Member since 2012 · 173 posts · 44 votes
    12y

    @Richard D. My thoughts exactly. I believe they kept sending letters in hope that they would get a response from me about the old loan. Dirty trick.

    @Wayne Brooks Where did that come from? Did you read this thread? If you look further back in the posts this was already discussed and was the first piece of information I learned about tax deed sales. This information was implied at this point in the discussion...but thanks for trying to help I guess.

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  • Wayne Brooks
    Real Estate Professional · West Palm Beach, FL · Member since 2012 · 23k+ posts · 13k+ votes
    12y

    @Daniel Miller 

    Maybe you just said it wrong.  True they no longer have any claim or lien, against the property.  But, the fact that they didn't bid at the auction has no effect on their claim for the surplus funds from the actual tax deed sale (bid price less taxes owed and clerk fees).  Of course, in their confusion, they may not have applied for the surplus within the required 60 days.  The collections dept sending you notices, probably doesn't even know (from their legal dept) that the mtg was wiped out!

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  • Patrick L.
    Real Estate Investor · Saint Petersburg, FL · Member since 2013 · 1k+ posts · 951 votes
    12y

    It seems like there was a quiet title action before he purchased it so that would clear up any remaining question of the bank's status of any liens on the property.

    Also for clarification the bank could have simply redeemed the property prior to tax sale rather than bidding on it, which is generally what happens when a bank has any interest in pursuing it.  

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  • Richard D.
    Investor · Fort Worth, TX · Member since 2013 · 309 posts · 150 votes
    12y

    Wayne is probably right, the collections department is probably clueless that the lien is no longer enforcable, and as far as they know you just assumed the mortgage. I do see this a lot in large mortgage companies, the right hand doesn't hve a clue as to what the left foot is doing, and vise versa. 

    You may want to notify them of the changes, and be prepared to send copies of the suit, and deed paperwork. Just as CYA precaution, so they don't try and sue you.

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