Need Advice: Buying a clouded title

[NaDean Bowles]

I'm all set to sign a contract for a seller financed property. When I asked what title company they used, they said they don't use a title company. This is a set of investors who work with a real estate agent. I've known the agent for a while through my REIA. They have been working together a long time, basically trust has been established by association. They do this all the time. The investors buy tax deeds, clean up the title, and sell them. Well, apparently they sell before getting the title quieted. Apprently they will turn over the clean, quiet title as soon as they get it. They anticipate that to take about 6 months. Right now though, it does have a $500 lein on it.

Does anyone have experience with this?  They are seller financing but at a high rate with the understanding that in a year or so I will finance through the bank.   Of course, that's with the title clean.  I will be putting money into the property that they are not guaranteeing if the title fails.  Would you be comfortable with this?

[Rick H.]

Some "investors" who work with agents who, in turn, prowl REIA's, is only as reliable as their character.

But you don't really know their character. You only know what these people wushu for you to see. Ask the people who trusted the two who ran a verb popular REIA in Orange County, CA who took investor money and allegedly used in a shell game in Utah.

I smelled it, but others ( who did not) gladly wrote checks to the promoters. These are called plaintiffs and defendants.

Consequently, acquiring a property without benefit of title insurance means that the benefits to you of the "purchase" are most certainly restricted. 

Lack of knowledge of the severity of the title problem(s) and more importantly the knowledge, skills and perhsps resources to solve them means that you may be stuck pouring money into a hellhole feeding a hungry devil. 

At least when I makes mistakes without a middleman, I only have myself to blame. When I let a middleman sell me a black box bill of goods, I'm relying them to fix it. If they can't or don't, it's up to me. Yuck!

One way or another, you're going yo get an education.