Title Search with Special Warranty Deed

[Leigh Ann Smith]

We are considering bidding on a home being auctioned on Homesearch.com.  We've had a realtor walk us through the house, and we are pretty familiar with the neighborhood, so we feel okay about that part.  

I've been reading lots of BP posts about special warranty deeds, but I'm still not clear on the title search and title insurance.  If I understand correctly, the special warranty deed does not mean that there aren't liens against the property.  Is that true?

 If we are the winning bidders, will the title company perform the title search before closing?  If anything is amiss, will we be able to back out of closing?  If so, I presume we would lose the $3,000 earnest money and $2,500 auction fee.  

Even though I've done lots of reading here about title searches, it sounds pretty tricky to me. The auction closes tomorrow, so I don't believe there would be time for one of those title search companies to search it for us.  Or would there be time?

We do know that the home was built in 1971 and a loan was issued on the home in 2004.  The male owner passed away in about 2012, and his wife passed away in 2013.  About $60K was owed on the loan.  That would lead me to believe that the property taxes also may not have been paid in a couple of years at least, and at $3,000/yr, that's significant.

I'd appreciate any advice!