Hi all:
I need advise here. I have a property on contract but the seller has tax and association liens. I negotiated the price so that I pay the liens for the seller.
I am about to open an escrow acct. Off course, I can’t get the deed unless the liens are paid. What I am wondering is: once the liens are sold, can the seller refuse transferring the deed to me? Contract is assignable too.
Thanks in advance.
When you say tax lien, are you saying property, state or federal tax lien? When you say that the contract is assignable, are you saying it is a purchase contract or an option contract that is assignable?
Anyway, there are many types of deeds. For example, in California, you can get a quitclaim deed which transfers ownership of a property with all the liens intact. So you don’t have to worry if the owner will transfer title if you perform.
What typically happens here is that you have a title company involved. The title company will not insure title to you until the liens are paid off. You deposit the money to purchase the property and pay off all the liens into escrow. The seller then deposits a notarized grant deed into escrow. Once escrow has your money and the grant deed, then escrow will wire money to pay off the liens and then record the grant deed. The wiring of money and the recording of title either happens on the same day or within 24 hours, depending on the county the property is located in.
If this is California and you don’t have the money to pay off the liens and the terms of the purchase contract, just assign it to your end buyer and let them deal with how they want to acquire the property.
Simple answer… Close it at the title company with a title insurance policy and they will make sure its free of all liens! :beer
Simple BUT incorrect response.
Ttitle companies as a matter of policy WILL NOT insure tax lien acquired property…MUCH too MUCH liability.
Bill H, He said it had a Tax Lien on the property… Not that it was a Tax Lien acquired property. Big difference…
Call your Title Company and make sure it’s Covered…
Strait from my Title Company’s website!
What Is Title Insurance?
Title insurance is protection against loss arising from problems connected to the title to your property.
Before you purchased your home, it may have gone through several ownership changes, and the land on which it stands went through many more. There may be a weak link at any point in that chain that could emerge to cause trouble. For example, someone along the way may have forged a signature in transferring title. Or there may be unpaid real estate taxes or other liens. Title insurance covers the insured party for any claims and legal fees that arise out of such problems.