Expert: Dick Dennis - 2/27/2007

Question
Thank you for your response. I have no emotional ties to this house, or any that I purchase for investment purposes. That's the whole point, I want to be able to get rid of it as soon as possible. I have no intentions of living in it. I understand what you are saying that it is not likely that someone would be able to finance something that you couldn't get title insurance for a year on and I appreciate your input. But my concern isn't buying the house, I won't be financing it, so I don't need title insurance. My concern is reselling it.I know most people wouldn't want to buy, just wanted to know if there was anything legally prohibiting me to sell. I figured most people wouldn't want to take the risk, just wanted the legal stand point.
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The text above is a follow-up to ...

-----Question-----
Hi! I am purchasing a property (home) at a public tax sale auction in California. There are no liens, and once it's all recorded the title will be in my name. However, the county can take back the property within a one year period from the time of the sale if for any reason it was recorded wrong or any other irregularities that would cancel the sale. They say not to make any improvements until that year is up (ie: building on vacant or undeveloped land, remodeling...ect.) but nobody has any information on when you can sell the property. I don't really want to hold on to it for a year if I don't have to but am not sure if I could sell it. Again, I would have full title, so in an amateur point of view, I don't see a problem. Maybe you could help with shinning some light on the situation for me I would greatly appreciate it. Thanks!
-----Answer-----
As a California broker, Brittany, I would never suggest my client to buy this property without also buying a complete title search, lot lien judgement report and anything else that the title company would offer as part of their service. Depending on the price of the property, this may cost anywhere between $1,000 to $2,000. If, however, after the title insurance company tells you, after they have discovered the history of the property, that they cannot give you title insurance, then I wouldn't buy the property. This may be an emotional purchase for you, but unless you intend to live in it, then you have no business getting emotional about an investment property. It may cost you lots more later on.

It wouldn't hurt to hire a REAL ESTATE attorney to protect your interests. You may not need one if you hire a title company because their attorney would protect your interests in protecting their's.

I do wish you well, Brittany.

Dick Dennis          dixiedee13@aol.com

Answer
That's just the point, Brittany. Your buyer, whoever it is, is not going to buy the property without title insurance, especially if he uses bank financing. So, you have to make sure the property will take a title search clearly. If not, you are asking for trouble, or, you're going to have to wait a full year before you can resell it and hope it can pass a title search at that time. Hey, if you think your purchase price is such a good deal, then go right ahead and buy it with those caveats they've given you. There's no better teacher than making mistakes. Again, I do wish you well.

Dick Dennis