All Forum Posts by: Edwin Bethune

I'm looking to purchase a tax deed property in my state of alabama. The road block that's got me is after I've used a hard money loan for the purchase and rehab of a tax deed property, how will I get from under the hard money loan? Normally, you could cash out refinance but I don't see any credit union (CU) approving financing on an uninsurable title. I'm thinking I'll have to wait until I do the Quiet title lawsuit/get a clear and (an insurable title) title insurance. But then again how would I pay back the initial hard money loan in the mean time.

Note: Alabama has a 3 year redemption period, so, the Quiet Title lawsuit can't take place until after the 3 years of me acquiring the deed.

My goal is to 1 not be stuck with the hard money loan. Any advice would be appreciated

2 Votes

Birmingham, Alabama

Quote from @Kevin Sobilo:

@Kim Frantum, are you aware of the potential title issues you may have with a tax auction property? Even tax sales advertised as "free & clear" are often not quite exactly that.

The details can vary by state, I'm sure but in my state a few of the potential issues are:

- Clouds on the title caused by not notifying interested parties correctly (perhaps requiring a quiet title action)

- IRS Tax liens

- Unpaid estate taxes because many properties were part of estates. So, the estate taxes need to be paid (by you) to clear the issue up

- Inability to get title insurance for a year (in my area) because the tax sale process is so messy. So, that even if the title looks clean they won't issue it. That will likely prevent resale or even refinancing during that time.

Check with a real estate lawyer in your state to discuss the potential issues common where you are.

I'm also looking to purchase a tax deed property in my state of alabama. The road block that scares me is after I've used a hard money loan for the purchase and rehab of a tax deed property, how will I get from under the hard money loan. Normally, you could cash out refinance but I don't see any credit union (CU) approving financing on an uninsurable title. I'm thinking I'll have to wait until I do the Quiet title lawsuit/get a clear and (an insurable title) title insurance. But then again how would I pay back the initial hard money loan in the mean time.
Note: Alabama has a 3 year redemption period, so, the Quiet Title lawsuit can't take place until after the 3 years of me acquiring the deed

1 Vote

Detroit, Michigan

Good morning BP

I’m working on getting funding from a private lender. I was told this when I brought a few properties to the table. Is this normal practice? Sounds like they want my down payment and for me to sit back and allow them to do/manage everything.

0 Votes

All Forum Posts by: Edwin Bethune

Edwin Bethune has started 2 posts and replied 3 times.

Post: Searching for a solution on Tax Deed purchase/ rehab/ cash out refinance

Post: Bidding on tax auction property

Post: Private money lender question