Thread: title questions regarding tax sale in California

Hello,

California counties conducts tax sale auctions for properties five years delinquent on their taxes. There is a house coming up for auction that my husband and I are interested in. However, the situation is a bit complicated. The owner of the house died in 1994 without a will. The house went through probate court and in 1997 the court gave each of the 5 children 1/5 of the house. However, none of the children were present at the probate hearing. The deed was never transferred into any of the heirs names. The deed still indicates that the house is in probate.

The validity of tax sales in California can be challenged by the previous owner for one year from the date of the tax sale. Here are my questions:

In this case do the 5 heirs have any claim to house (could they file a challenge)?

Would ownership that could be ruled invalid be good enough to get construction loan?

Would ownership that could be ruled invalid be good enough to get a Home Equity Line of Credit?

What would the probate situation of the house do to the title?

And, what kind of problems might it cause?

Any advice you could provide would be greatly appreciated.

Thank you!

"The former assessee or any lien holder has one year from the date of recording of the tax deed to challenge the validity of the tax sale (Revenue and Taxation Code 177 and 3725). During this one-year challenge period, it may not be possible to obtain a guaranty of clear title from a title company. Title companies may not issue their policy of title insurance on property that was purchased through tax-defaulted public auction, unless a quiet title action has been successfully pursued in the courts, or in lieu thereof, quit claim deeds are acquired from the former assessee or every lien holder. To learn more about quiet title actions, you may consult with an attorney experienced in real estate transactions."

It looks like the heirs could challenge the sale (based only upon the irregularities in tax collection/sale), though they may have to get probate cleared up first.

It could cause problems with loans since it's possible you wouldn't have a clear title (which could eventually be cleared up, but could cause problems the first year).

I'd contact a real estate attorney and ask them.

-Tim

I would consult a seasoned real estate attorney on that one. If you have a realtionship with a title officer, maybe the title companies in house attorneys could give you their opinion of find a sollution.