A precarious real estate situation is surprisingly common for real estate investors. The property is bought, and everything seems to come out fine. In six months, the state issues a document to the new title owner. It says that they owe back taxes on the property. It also details that they need to make changes to the home to meet state code, including reducing the size of the deck, changing the driveway to a different grade, and repairing the water system.
The new owner is responsible for all of these changes because he or she is the title owner. But, many of these concerns, particularly back taxes, should have been paid out upon closing. It is the title company’s fault that these state-mandated changes were not met at the time. Any taxes owed on the property must be paid when the title transfers.
Title insurance covers any oversights made by the title company, but, title insurance is expensive. Investors think they can get away without it after following the proper due diligence. Can the Real Estate Attorneys in Angola Indiana do anything if title insurance is not purchased through the title agency?
There is often a silver lining somewhere in the proceedings. The investor would need to essentially prove one major ingredient. Did the initial owner intentionally misrepresent the property’s credentials? For example, a property lien could have been placed because of the owner’s unwillingness to meet a certain code by the association. They could have reported that the changes were made to meet the new code, but perhaps it was not. The lien could have been removed, but it was a mistake. When the association reviews the property again, they add the lien that was once removed. It was an issue that dates back to the previous owner, but now it falls on the new buyers.
Title companies can also be liable if their oversight was because of an improper filing or negligence. An investor should not have to always buy title insurance if they are led to believe the property is in good standing and lien-free. Speak with the team of Real Estate Attorneys in Angola Indiana, at website or their Facebook page to see if there is a case that can be pursued.
