When you make an offer on a property, a home through the Multiple Listing Service or through a Trustee sale, it’s always a good idea to review the chain of title. At a Trustee Sale you can purchase a “limited title report” for approximately $80 to $110.
The reason for obtaining a chain of title is to ensure several things. One, that the foreclosing lender is a first position lien holder. Secondly, are there any IRS liens, mechanic’s liens or Arizona property tax liens.
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 have redemption rights. Although they are not as common as the other liens mentioned, they do exist. The IRS can seize the property 120 days of notification of the Trustee Sale. It is important to note the word “notified” and not “after a winning bid”. The IRS could actually seize the property within a few days after a purchase has taken place at the Trustee Sale.
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.
Arizona State property tax liens are almost always present on a property that is going to foreclosure. Although these liens do need to be paid by the winning bidder at the Trustee Sale, in Arizona, property taxes are relatively inexpensive so this lien typically doesn’t hurt the investor’s profit margin.
Homeowners, investors and the like can have a great experience and profit at Trustee Sales in Arizona . Winning the bid at a Trustee Sale builds your confidence knowing you gathered all the proper information prior to the home sale.
By doing your research correctly and timely can reap amazing benefits to the investor. Arizona currently has some of the best bargains in the country for the savvy investor