The Trustee Sale-Confirm Liens On The Property
Oct 22, 2009 Real Estate
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A key component when purchasing a property at a Trustee Sale (or any sale for that matter) is to research the chain of title. You can typically purchase a ‘”limited title report” for $80.00 to $110.00.
There are two main reasons why you need the title history. First, you need to be sure the foreclosing lien holder is in first position. Second, you want to verify that there aren’t any IRS, property tax or mechanic liens on the home.
Keep in mind we’re buying a “lien” vs a “property”. Not doing the proper research could cause us to buy all “liens” without our knowledge and drastically increase our liabilities and responsibilities.
IRS liens are rarer but more important. Per the IRS redemption rights, it states the property can be seized 120 days of notification of the Trustee Sale. Note the redemption period starts upon IRS being notified.
Another lien to consider is the mechanics lien. After verifying this type of lien, your next step will be finding the lien holder then try to negotiate a settlement. Contacting an attorney might be wise, otherwise consider passing on the home.
The less threatening and most common type of liens are property tax liens. These liens are almost always present on foreclosure properties. The property tax lien usually does not affect the buyer’s profit margin. They also do not have to be paid at the Trustee Sale.
Trustee Sales in Arizona can help investors and homeowners gets great prices on homes in the Phoenix area but you need to do a little homework regarding the value of the property and the liens being purchased and acquired by the successful bidder.
With the over-correcting of property prices due to the boom in 2005, buying Arizona Real Estate can be a fruitful experience. Arizona has some of the lowest prices per square foot in the nation.
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