The residential and commercial real estate markets in Detroit, and throughout Michigan, have been taken on a proverbial roller-coaster ride in recent years. Despite past turmoil, investing in real estate remains a vital interest for homeowners, investors and businesses alike. Protecting financial interests in any real estate investment is critical. With many properties changing hands due to tax liens foreclosure, mortgage foreclosure and multiple investment transactions, the risk of finding a cloud on the title to a specific piece of property is real.
Sales Of Foreclosed and Tax-Forfeited Properties Remain High In Michigan
Sales of tax-forfeited properties and foreclosed properties increased dramatically following the real estate market meltdown in 2007, according to MiBiz. The upward trend has continued, creating an increase in property available through tax auctions each year. Investors, future homeowners and businesses can often purchase real estate at low cost in a tax auction. These transactions, however, can be more complex than a more traditional real estate transaction. Notably, the Foreclosing Governmental Unit (FGU) will typically transfer the property through a quit-claim deed, providing the buyer with whatever title the FGU held – which could include a variety of defects that cloud the title.
Purchasing foreclosed real estate or tax forfeited property may require taking further action to protect the real estate investment. Many title insurance underwriters will balk at insuring property purchased at a tax auction without addition legal action to clear the title. A skilled real estate lawyer who has a strong command of the rules and procedures to successfully prosecute a quiet title action is critical to safeguarding property rights in non-traditional real estate transactions.