Zombie Title With Squater

[Robert Martin]

Ok Bigger Pockets, Got a Doozy of puzzle for y'all. Any help or ideas would be appreciated. So here is the situation: Guy dies (in 2010) with 2 properties under water with the mortgage companies by a fair amount. No will. Kid inherits properties and 'Abandons' them in probate, allowing for the banks to proceed with foreclosure. BUT the Banks never did! Title never changed and no deeds were ever recorded at the county clerks. (The banks, however have been paying the property taxes and HOA fees.) So the heir of the estate (who doesn't think/ isn't aware he still owns the properties and wants nothing to do with them) is presumably holding title, and while the banks have valid liens in place, they have not done anything with the properties. Meanwhile, one sits derelict and abandoned, and the other has a "tenant" that was there before the owner died. He hasn't had anyone to pay rent to for over TWO YEARS! This 'tenant' would love to give his money to someone and/or outright buy the property, but he can't figure out who to talk to. It would be a great deal if I could find a way to get the deed to the property either from the bank, at auction, or from the old owner's estate. Any thoughts?

[Davido Davido]

Hello Robert,

Get a quit claim deed from the heir(s) and record it. Collect rents due  from the tenant. Wait out the statute of limitations on the mortgage debt.  File a quiet title suit to clear all mortgages and debt liens.  Own and enjoy your new property. 

Texas has a statute of limitations on collecting past due debts.  Once that period is past, the debt becomes unenforceable and you can quiet (clear) the title in your name. For most debt, the Texas statute is 4 years, for deficiency judgements it is only 2 years. Texas Property Code Section 51.003 Contact your attorney.

Until you are certain you'll get title only pay the minimum property tax to prevent property tax foreclosure. And do the minimum maintenance to preserve the property. From what you've written, you may have a winner.  I've done several of these, a headache for some, but I found my niche.  It was pleasant work.  Be aware that mortgage holder, and or other investors who may acquire the debt could foreclose at anytime until the statute of limitations runs out.