Clearing title cloud - Posted by BCat (SoCal)

Posted by Brent_IL on February 20, 2002 at 22:19:55:

You need a lawyer. One point that strengthens the neighbor’s claim is that the bank and/or previous owner watched the garage being built without objecting.

Clearing title cloud - Posted by BCat (SoCal)

Posted by BCat (SoCal) on February 20, 2002 at 18:46:53:

I’ve found a foreclosure that I can get pretty cheap, and then turn around and flip it. The bank’s (actually, HomeStep) been holding it for 6 months, and it just fell out of escrow. The property shared a garage with the house next door. When the garage burned down the neighbor rebuilt the garage without any help from the previous owner, so now the neighbor is claiming the entire garage and the portion of the land on which the garage sits, so there is a cloud on the title placed there by the neighbor.

No one will touch the property because of the cloud (that’s why it fell out of escrow), so I think I can get it cheap - as long as I can get the title cleared up. I haven’t talked to the neighbor yet, so I’m looking for some strategies for clearing the title. I assume that if I can get the neighbor to sign a quit claim to the contested area, everything will be OK.

The sticky part is, of course, getting the neighbor to sign. The most obvious (to me anyway) of handling this is to pay the neighbor for some portion of the cost of the garage. I’m just a little leery of paying for this before I actually own the property, but on the other hand, I don’t see how I can buy the property if I can’t get title insurance because of the cloud. Does anyone have any better ideas?


Re: Clearing title cloud - Posted by JoeS

Posted by JoeS on February 21, 2002 at 11:49:49:

Try this to cure. Like you said, pay the neighbor to sign off; get a survey and break off the portion of land that the neighbor’s garage sits on; clear up the title with an addendum stating that the portion in question was separated from the original deed.

I once bought a property that had a warranty deed for 75ft of frontage and a quit-claim deed for the remaining 25 ft of frontage. That is how I sold it. But when the appraisal came in, it appraised only the part that I could issue a warranty deed for. The same for a title policy. That’s how the current owner still holds title.

If the property in question is such a great deal, break out the portion of ther garage in question and buy it without a garage. Hope this helps.