I will never be able to say it enough. Find yourself a title company you trust!
This is crucial in the game of real estate investing and here’s why…
So there’s this investor who’s buying a high-end property from a seller, and the seller was upside down and the investor decided to do a short sale.
There were three mortgages on the house, and more than $90K was owed to the HOA.
In a swift action, the HOA within swooped in and foreclosed on the property and took over the title.
Now the short sale switched from buying from the seller, over to buying the house from the HOA.
But in the foreclosure process, there was not a proper return of service for one of the lien holders. If a lien holder was not given proper notice in the foreclosure, then the lien can still stick. The HOA will now have to re-foreclose out the interest of the lien holder that they failed to give proper notice to.
All this takes time, and it’s really of no concern to the investor because it can work to their advantage. The investor has the property tied up under contract, and they have ZERO dollars down for earnest money deposit.
The contract is acting like somewhat of an “option” on the property to buy it at a specific price, and the market is slowly going up.
There is always a chance that the lender may want to renegotiate the deal as the market goes up, but the investor knows the lender just wants to get out of the bad loan they created and close.
So what to pull from this?
Always, always, always get the title checked by a competent title company, and be patient when title problems arise.
Things happen quicker than you think but have a good power team, especially a trusting title company and they can help you get over all those speed bumps. No matter how big or small.
