The title stuff on cheap land is scaring me off before I start

A title search examines the recorded history of the parcel and reports what's on it. Done properly it should surface the deed chain, recorded easements, liens, unpaid property taxes, judgments, and severed mineral or timber rights if the severance was recorded. So most of your list is findable before closing.

The heirs situation is different in kind. If the owner of record died and the estate never went through probate, nobody living can convey clean title until a court sorts out who owns it. A search will show you the problem. Fixing it means probate in the county where the person died, and the timeline and cost vary by state and by how cooperative the heirs are. That can be six months. Your assignment buyer will not usually wait.

Tax deed chains are the other soft spot. Recorded tax sales look clean on their face, and whether prior interests were properly extinguished depends on how the state's notice requirements were followed at the time. Some title companies will not insure a tax deed parcel until a set period has passed or a quiet title action is done, and that varies by state and by underwriter.

Practical order of operations: get the parcel under contract with a due diligence period first, open title, then read the commitment yourself rather than only the summary. Schedule B of the commitment lists exceptions, which are the things the policy will not cover, and that is where the easement across your buildable area shows up. Ask your closer which items would survive closing.

The exceptions page is the whole document. Everyone reads the first page and stops.

Sorry, what is quiet title? I've now seen it three times in this room and assumed it meant something about noise ordinances.

@rigging court action to establish who owns the property and clear off old claims. Takes months and needs an attorney, so on a $20,000 parcel it can cost a meaningful chunk of the deal.

How do you even find out an owner died? The assessor still lists their name. Do you just call and someone's daughter answers?

@ember pretty much. Or the mail comes back, or the phone belongs to a relative now. On the management side I've seen tax bills going to a dead person for years because nobody ever told the county.

The HOA one is what gets me. Old platted subdivisions in Florida and Arizona with dues that accrued for twenty years and a lien nobody mentions until the closer pulls the estoppel. Does a standard title search always catch a recorded HOA lien, or only if it was actually filed?

@pike only if it was filed. Unfiled arrears still get demanded at closing and whether they're collectible against a new owner depends on the state and the declaration. Which is why I ask for the estoppel letter in writing every time.

On the lender side of this, severed minerals rarely kill a residential land loan, but a recorded easement crossing the only buildable envelope will. If the buyer needs financing, the exceptions page decides the deal, not the price.

Is it normal to be doing all this on a $15,000 parcel? A $500 search plus a perc test plus maybe a survey and I'm four figures into a deal that pays $6,000.

@compass that's the actual economics of it. You spend on diligence for the parcels that survive the first screen and you kill the rest on free information, GIS layers, flood maps, and the county's own parcel notes. I won't open title until I've read the plat.

Still not sure this pencils for me. If two of three parcels die in diligence I need the survivors to pay for the dead ones, which means the discount going in has to be much bigger than the numbers people quote.

Land seemed like the simple version to me because there's no roof. Leaving this thread less sure than I arrived...