A couple of thoughts…first even if you never get perfectly clear title, the property as a rental might produce thousands of dollars for you as the title currently exists.
I had this situation several years ago where a co-owner had been taking (stealing) all the rent from a little rental although she only owned a 1/2 undivided interest…then, one day, I found the property empty, the last scruffy tenant having apparently just moved out, and I immediately changed the locks and took it over and rented it myself for several years, claiming that all the rent was mine to keep because of what she owed me. Despite mountains of threats, she never filed suit because she really didn’t want a full accounting that she knew I would have demanded and been entitled to…so my half interest was good enough for me to get and keep the rentals. For several years!
Second, with a potential $30,000 gain, why would you not spend the $200-300 in hiring a RE attorney to look it over and at least tell you what would be needed to clear the title for you?
GREAT DEAL with Title snag - Posted by Bird Dog Ron
Posted by Bird Dog Ron on August 02, 2002 at 16:03:49:
Hey guys,
I have this great deal and have had the seller accept a verbal offer of $13,000. The place needs a little work in a neighborhood that goes for about $50-$60k.
Here’s the prob. The original owner has died and simply “gave” the house to her grandmother who then “gave” the house to the present owner her grandson.
None of this has been recorded or have gone through probate. He has been renting this place out for the last 3 years or so and acting as owner.
He does have the original deed from the original owner, but it has not been signed over to anyone.
Is this situation workable? Can a title company issue a bond for the title on this? Is it worth the hassle for a $30k profit?
How to sell what you’ve got - Posted by John Merchant
Posted by John Merchant on August 05, 2002 at 16:55:17:
Remember, too, that WHATEVER you have or own, you can sell, via a Quit Claim Deed, just describing what rights you have or think you have, and any buyer is welcome to buy same at his/her option. So if you have a property on which you’ve never had a deed, but from which you derive a rental income, heck, I’d bet there’s somebody out there who’d buy whatever rights you have, for some amount…even if they never got a full warranty deed.
So don’t feel your rights are worthless, especially if they’re producing income. If I looked at the situation and concluded, from the docs and deeds you have and can prove exist, that you have as much right to the possession of the RE as anybody in the world, and nobody has any superior rights to yours, I might be willing to buy those rights from you for a certain price, and I’m sure not unique.
A couple of thoughts. The Title company will have to search the original owner and all the heirs. The same for the second owner. After it is determined that no one has a legal claim to the property then a Title policy can be written on the property. Cost for all the searches? Probably around $600 to $1,000. A fair price in light of all the work involved.