Auction, Title Insurance, and Quit Claim Deed

[Kwame Lewis]

Hi everyone, I am new to Bigger Pockets. I have a few questions regarding a situation my father is in as he is a real estate investor. Basically in 2017, he bought a property at a city auction but long story short the person he was working with did not do a proper title search and my father found out that the property he bought to renovate could not be sold until approximately a year later (February 14, 2018).

Now the 14th has passed and my father had a buyer and a deal set, but it turns out that the property does not have a clear title. The previous owner moved to North Carolina and supposedly was not notified that the property was I guess seized. The previous owner has not payed taxes  nor a mortgage on this property for two years. So my father's realtor reached out to previous owner who said he will not sign the deed to give away the property without getting 25k in return. We will not do this. So my father reached out to a lawyer who wants to do a quit claim deed but is asking for $4000 to advertise in this guy's city. I believe the advertisement is to let the previous owner know that his property is being given away. I don't see why this is necessary as the previous owner is well aware.

My father found a title company that was willing to work past this in some capacity, but will not give title insurance as there is no clear title and do not want to give insurance in the event that previous owner wants to challenge in court that he was not notified about the property being seized. Does this mean he has the right to come and claim it? I mean my dad bought the house from the city and we completely renovated it. I don't see if he hasn't been paying for anything how he can still possibly claim the house. Isn't this on the city who sold the property?

Right now, my father is in a bind because he has this great property to sell and the options presented aren't great, especially as the current buyers want seller's assist as well. Has anyone dealt with something similar to this issue or know where I can begin seeking counsel for this matter? Any feedback you can give would be greatly appreciated.

[Tom Gimer]

@Kwame Lewis When you buy at auction you don't necessarily get free and clear title.

Best course of action is to hire a good attorney to work this out. Dad could possibly have a claim for the improvements made if the ownership claim doesn't work out.

Sue the city over an uninformed sheriff's sale purchase? lol