So...you bought a home in foreclosure at a fraction of the former price and maybe did a few home improvements with the money you saved. Now you find that thousands of foreclosures around the country may be invalid because of bank paperwork mishandling problems. Should you worry?
The first thing you should do is check to make sure you have title insurance, which protects you from any claim on the property that surfaces after the deal has closed. Those claims can arise from unpaid taxes or legal glitches in the ownership documents. Most people who take out mortgages are required by their lenders to buy a policy. For those paying cash, it's optional but highly advisable, especially now.
"If you're a bona fide purchaser with title insurance and no knowledge of any irregularities in the transaction, courts are going to be extremely loath to set aside the sale," said Diane Thompson, an attorney with the National Consumer Law Center.
A homeowner with title insurance shouldn't have to worry if the previous owner stakes a claim to the home. Experts say the the title company would most likely settle with the evicted homeowner -- not the new buyer.
What about buying right now?
Buyers who are making a foreclosure purchase from a bank shouldn't be concerned as long as you can get title insurance. If the title insurance company won't sell a policy on a property, you probably shouldn't buy it.
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment