HELP!!! Do I have equitable title or not? - Posted by ScottSC

Posted by djswett on November 04, 2000 at 17:44:22:

Both of your questions are mired in the potential of a lawsuit and it will involve your money. If the deal can’t be straightened up, a lawsuit is not worth it. The cost for an attorney will be so high, that you would be smarter to just walk away from either the deal or any money you have in it.

Having a broker act as the middle person is not going to protect you for doing your own due diligence. Many states do not have the protection of title insurance and the escrow closing is very casual and will put your money at risk with this kind of tax lien problem.

You said you had a land-MH deal; yet the tax lien was only against the MH. That does not compute. The local tax authorities attach whatever equity that they can to enforce their tax liens. If they went after only the MH, I suspect that the land is owned by some other entity. You better find out who.

Also, you mentioned that the end of the redemption period just ended. That is good because that means that the finance company can now sell the MH without any claims from the prior owner of the MH. This does not mean that they are selling the land. Quoting your words “only the MH is in discussion”.

Also, if you are obtaining title to either the MH only or the MH and land together thru the tax lien title, maybe legal counsel will advise you that you need to also sue the previous owner to make sure that there will be no residual claims by that previous owner. It could have been a divorce (H/W) and yet only the hubby signed on the MH loan, thus the ex-wife would have potential community property rights that need to be quit claimed.

With real property, the best deed of title transfer is “warranty”, which gives you recourse against the seller for putting you into a bum deal, but usually these outfits give you a “quit claim with no covenants”. Thus, they give you only the same title that they have and it can be screwed up. Thus, they take your money and you get a screwed up title.

One solution is to go to the tax assessor and ask to see the file folder for that property (MH and land). They have quite excellent records. This will give you a bit of guidance as to the names of all the past owners and exactly what the legal documents on file for your current tax lien owner.

You have an agent/broker to share your concerns, perhaps someone in their organization has enuf experience to guide you with some of the hooks in this deal.

Remember a screwed up deal is a potentially rich deal to you. Someone has to solve the problems and you can be that person. By high lighting the bad aspects of the deal, you can hammer a better price and gain some indemnification to protect your bucks–this is where some good money is made in real estate.


HELP!!! Do I have equitable title or not? - Posted by ScottSC

Posted by ScottSC on November 04, 2000 at 14:43:57:

I put a purchase contract on a land home package about a month ago.

We have not gone to close yet. Just found out the mobile home only was bought at a tax sale one year ago and the redeemption just expired. The taxes on the land were paid by the seller (a finance company that repo’d the property.

I discovered this on the last day of the redeemption period and called the listin agent, he called the seller asap.


1.Do I have equitable title because of the contract
and 2. does the seller have to acquire the mobile home to honor the contract with me?

Help please

I need to know asap

Tax lien Conflicts - Posted by djswett

Posted by djswett on November 06, 2000 at 13:37:33:

I have sent you a personal email response, but I am also posting my response to the CRE URL. In order for others to follow the conversation string, I would ask that you also post your previous email to the CRE URL.

This is the way I interpret your email. The land/MH package was owned by person A. Then the lender foreclosed upon the package thinking that his security lien was against both the land/MH, but he was wrong. The lender paid the arrear taxes on the land thinking that he was taking care of ALL taxes, but he missed the tax due on the MH. Now person B stepped in and paid the arrear taxes on the MH and now owns the MH after the end of the redemption period.

I think that this means that the lender owns just the land and person B owns just the MH. Now person B will have to move the MH or start paying lot rent. Since that doesn’t make much business sense, I think that the two parties will sit down and negotiate some kind of mutual financial settlement. The broker is not involved in this situation whatsoever. The bank may hire the broker to represent them in negotiating with the MH owner; but I doubt it, attorneys will be involved cuz of the legal complexities.

The lender does not want to own anything–that is why they had it listed for sale thru the MLS broker–they wanted out. Now they have screwed up cuz of the non payment of taxes and the conflicting lien of the MH tax redemption, it will be tougher for them to sell right now.

I think that anyway you cut it, right now today, you are not a player in this deal. I will wager that person B will approach the lender and try to make a deal with them to buy just the land and be able to keep the MH on the lot. Then he will try to sell the land/MH package by himself.

This might be an opportunity for you. Since the MLS broker has no contract or sales listing fee agreement with person B, you should go to person B to strike a deal while he is getting everything settled down. I suspect that person B is a fairly sophisticated investor because it was either dumb luck that Person B positioned himself with this tax lien and letting the redemption time out or I will bet that he was a savy investor who positioned himself with the tax lien and then kept absolutely quiet until the redemption timed out and then he stepped forward and told the broker, “keep out of my MH”. That’s when the broker called you with the redemption news.

What do you think? You found out about the end of redemption right on the last day, right? Just for the heck of it, call Person B and talk to him. I think that your chance of getting a cheap deal is gone because I will bet that he will be selling the package at full retail, but you will learn something and if you play it right, you will make a local business acquaintance. In the future, perhaps, he can push a deal to you or vice versa.

You never mentioned in your post, if you were looking for a home for yourself or doing a Lonnie deal. If you ae a home owner, then Person B will still be a good contact for buying your future home. Good luck, keep us updated with your strategy.