If you buy from a homeowner who owes backtaxes

[Twoply 0]

Do you get stuck paying them?

That is if you into the deal blind and didnt know about it?

I always made sure there were no liens on any house I purchased, I just wondered what happened usually.

The way cities are now, accountants are telling me if you owe back taxes, the city will settle for pennies on the dollar if you even offer up a chunk up front and forget the rest.

[Pokerstar 0]

I would bet it depends on the state and local laws. Your real estate agent can probably answer that one too.

Fortunately, I'm adhering to a pretty strict, uh, drug, uh, regimen to keep my mind, you know, uh, limber.
--- The Dude ---

[SuFantasma 0]

Quote

Do you get stuck paying them?

That is if you into the deal blind and didnt know about it?

I always made sure there were no liens on any house I purchased, I just wondered what happened usually.

The way cities are now, accountants are telling me if you owe back taxes, the city will settle for pennies on the dollar if you even offer up a chunk up front and forget the rest.

That's why you get a title search and insurance before purchase ... if there are an liens on the property, the title search will reveal them and the title insurance should cover you .

However, the purchase contract should be clear as to what monies are due on the property, who is responsible for the monies due and what recourse is agreed upon shall any of the underlying assumptions are not met.

Y yo, pa' vivir con miedo, prefiero morir sonriendo, con el recuerdo vivo".
- Ruben Blades, "Adan Garcia"

[ryoder 1,590]

That should all be spelled out and handled in the closing.

"There are only three things of value: younger women, faster airplanes, and bigger crocodiles" - Arthur Jones.

[MikeMcLean 0]

The key point is that they will be paid or settled before or as part of the closing. Who pays, how much the debt is reduced, etc. is all part of the negotiation. On a heavily discounted house (aren't they all now?) it might be worth it to a buyer to settled the taxes in order to close and secure the purchase.

It wouldn't hurt you to think like a fucking serial killer every once in a while - just for the sake of prevention

[MikeMcLean 0]

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That's why you get a title search and insurance before purchase ... if there are an liens on the property, the title search will reveal them and the title insurance should cover you .

The title search is supposed to find all of the liens so that they can be settled before closing and well as guarantee that the seller truly has rights to sell the property.

The title insurance protects your mortgage holder against a title search mistake and doesn't protect you at all - important difference. In the event of a serious title mistake (i.e. the supposed seller didn't have rights to sell the property) the bank will be made whole and the mortgage promissory note will be paid off but the defrauded buyer will be out the property itself, any closing costs + insurance, any improvements to the property, etc.

It wouldn't hurt you to think like a fucking serial killer every once in a while - just for the sake of prevention

[SuFantasma 0]

Quote

Quote

That's why you get a title search and insurance before purchase ... if there are an liens on the property, the title search will reveal them and the title insurance should cover you .

The title search is supposed to find all of the liens so that they can be settled before closing and well as guarantee that the seller truly has rights to sell the property.

The title insurance protects your mortgage holder against a title search mistake and doesn't protect you at all - important difference. In the event of a serious title mistake (i.e. the supposed seller didn't have rights to sell the property) the bank will be made whole and the mortgage promissory note will be paid off but the defrauded buyer will be out the property itself, any closing costs + insurance, any improvements to the property, etc.

Well, that fits the description of a "Lender's Policy", and that
s correct. If you have Owner's title insurance, my statement will hold true. Thanks for the clarification !

Y yo, pa' vivir con miedo, prefiero morir sonriendo, con el recuerdo vivo".
- Ruben Blades, "Adan Garcia"

[tigra 0]

Not exactly true. In most states, the purchaser gets an owners' policy of title insurance and the lender gets a loan policy. The owners' policy insures and protects the owner, the loan policy insures the lender. If you refinance your home later, you do generally pay for a new title insurance policy for your lender because things may have changed since the time you purchased your home. You will need to get a new loan policy (or at least an updated search) each time you refinance. But the owners' policy you received when you purchased your home is good for as long as you own your home.

Title insurance is different from other types of insurance because it doesn't protect you from future events but does protect you from undisclosed past events. Unrecorded liens, unpaid tax bills, fraudulent deeds, missing heirs who show up to claim property, etc. The title company does as thorough a search of the public records as possible and generally collects affidavits from the parties involved in the transaction stating there are not any unrecorded contracts or liens, etc. They charge a one time premium for the title insurance policy- a potential bargain in the case of an owners' policy (if the seller is not paying for it) and a necessary expense for the loan policy.