Today I’m answering your question, “Why would a property owner file a quiet title suit?” and the topics I’ll be covering are:
- Hiring a Quiet Title Attorney
- Quiet Title Actions and Deeds on Tax Defaulted Land
- Why Would Someone File a Quiet Title Lawsuit?
- Quiet Title Vs Quit Claim Deed
- Quieting the Title Can Solve Many Problems
- The Legal Process Used to Clear a Title is Quiet Title
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Hiring a Quiet Title Attorney
Why would a property owner file a quiet title suit? There are a lot of issues regarding property titles, change of title, and possession. That’s why we need to talk about quiet title.
I’m Ted Thomas, and I’m not an attorney or a real estate broker. I’m an author and publisher, an investor and a guide when it comes to tax defaulted properties. Most newcomers haven’t heard about quiet title, so we’re going to talk a little bit about it today. There’s a lot of confusion about this. Let’s see if we can clear some of it up.
I wouldn’t recommend that you do a quiet title for yourself. That’s my position. You need to think about hiring a qualified, experienced attorney when it comes to the quiet title process. You don’t want to hire just anybody who hasn’t done it before because they’re going to have to go learn it, and it’s going to take a while.
Quiet Title Actions and Deeds on Tax Defaulted Land
Quiet title can be needed on any tax deed property. My expertise is in this subset of the traditional real estate business. These are properties that are defaulted on the property taxes, and the county sells them for pennies on the dollar.
It doesn’t matter whether it’s a house, apartment or small farm. If they don’t pay the property tax, the county’s going to take action. What are they going to do? They’re going to sell that property at an auction, and the starting bid will probably be 10 or 20 cents on the dollar.
I’ve been involved in this business for well over 30 years. It’s not complicated, but most people don’t realize that it’s there. The major part of the business is the 25% of properties at tax defaulted auctions. 20% to 25% are residential land, or any kind of land for that matter, and most people don’t know to bid on those or how to bid on them.
It’s important that you look at these properties because they’re going to be priced right. Can there be some challenges with residential land? Yes, and what’s that question today? The question is why would a property owner file a quiet title suit?
Why Would Someone File a Quiet Title Lawsuit?
Tax defaulted properties are sold as-is at more than 5,000 tax defaulted auctions. If you’re going to buy land at a tax auction, they’re not going to survey the property.
You’re probably going to have to get a survey before you can get a bank to do any financing or before someone else will buy it from you. It’s going to be important to talk to an experienced broker to find out and what surveys cost and why you would want one.
I would suggest you know about surveys before you start buying residential land. Why? Where’s the boundary of the property? How would you learn what that boundary is if you didn’t have a surveyor?
The worst thing that can happen to you is to buy the property and find out another property owner built fences or could be raising cattle or a crop on your land. How are you going to know that? Once you do the survey, if they’re encroaching on your property, how are you going to get them off of there? That’s where quiet title comes into play.
Why would a property owner file a quiet title suit? If someone else has encroached on your land, you’d have to file a lawsuit to get them off the land.
You’re also not going to be able to sell, and most of the title companies are going to question you, if you don’t have a quiet title. How are you going to make sure it’s clear? A banker or any title company is going to make sure it’s clear before they’ll get involved in it to avoid a lawsuit.
Quiet Title Vs Quit Claim Deed
Local counties are going to take a lot of time and effort to tell buyers on their website, in the auction brochures, and in their statues, that they’re going to sell the tax defaulted property to the winning bidder with a quitclaim deed. Therefore, any defect in the title is going to be your problem if you’re buying.
They’re not warrantying. If you’re buying a property, they’re not warrantying that the property condition is good. The county is going to tell you at the auction that there could be consequences.
Why would a property owner file a quiet title suit? How else are you going to clear those consequences? Once you buy it, you’re going to go to an attorney to get a quiet title before you’ll be able to sell it, or in many cases, before the title company will even issue any title.
These are basically legal notices. They apply to you, so it’s something you’re going to have to learn about.
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Quieting the Title Can Solve Many Problems
Easements, taxes and mortgages on a property can be a problem. Surveying could be an issue, and encroachment is a big problem.
People will just move their fence right onto your property, and you’ll think, “Oh, I don’t own that part of it.” Well, they might just be taking property away from you by adverse possession.
You need to find out what the statute number is so that you can find out what the county is going to cover or not going to cover and what the rules are. For example, he statute number in Florida is 197. The rules are not difficult to understand, but there are rules. Just like anything, real estate has rules. Everything that’s bought or sold has to be done in writing.
When the county is going to sell, they’re going to transfer the property with a quitclaim deed. They’re not giving you a warranty. There may be defects in the land or in the title that are your responsibility. Anything that’s on the county website is buyer beware. You need to be the buyer that’s aware. Do the research if you’re going to buy or sell.
The Legal Process Used to Clear a Title is Quiet Title
Why would a property owner file a quiet title suit? Because that’s how they clear the title to make sure no one has encroached on the property and to make sure there are no liens filed on the property. In other words, if there are defects in the title, that’s how you’re going to clear them, with a quiet title suit.
A quiet title action is a lawsuit which has to be done by an attorney. I understand that some people can do it without an attorney, but I’m going to recommend that you find an experienced attorney, someone that’s done it before.
It’s going to be your responsibility that that title is clear. If it’s not done correctly, it will be your problem. Buyer beware simply means that you need to do your homework.
We hope you enjoyed Ted’s lesson, “Why Would a Property Owner File a Quiet Title Suit?”
So why would a property owner file a quiet title suit? One reason why you may do a quiet title action is to clear the title to make sure no one is encroaching on your property.
Ted and his students have ample experience with quiet title suits because they purchase tax defaulted real estate.
At tax defaulted property auctions, you can buy real estate for bargain prices, 10 or 20 cents on the dollar with no mortgage and no deed of trust. However, the county will likely transfer the property to you with a quitclaim deed, which would leave you responsible for any defects in the title. A quiet title can be done to ensure that the title is clear.
Ted recommends hiring a qualified, experienced attorney to do the quiet title process.
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Ted Thomas is America’s Leading Authority on Tax Lien Certificates and Tax Deed Auctions, as well as a publisher and author of more than 30 books. His guidebooks on Real Estate have sold in four corners of the world. He has been teaching people just like you for over 30 years how to buy houses in good neighborhoods for pennies on the dollar. He teaches how to create wealth with minimum risk and easy-to-learn methods.