Help! Can't get a clear title for new home

[HelpMeFriend]

When something sounds too good to be true, it probably is.
I am TRYING to close on a home that was purchased by a bank from a Sheriff's sale. I assumed it was a foreclosure. Now, the title company says that I can not purchase this because they have recorded that there is more land attached to it. Funny thing is that someone else says they own that land. It has the same address, is located directly behind the house, and is legally attached to the house. Why can't I get a clear title. I have to register my children for school by the 28th of this month, due to close for the second time today. This will not happen.
Any suggestions on how to fix my delima?

[strigiformes]

Did the title company actually say that someone else is claiming to own that land or just that the land might be owned by someone else and can't be included in the sale?

I ask because we have a house for sale that has an extra lot attached, and when we first listed it for sale, our realtor called to make certain that we were selling the additional lot as part of the property and had to change some of her paperwork to reflect that. Apparently, the extra land there is technically legally separate even though it is fenced in with the rest of the property and obviously part of the whole. Therefore, it has to be specifically included in the sale or the buyer would have a similar problem with getting clear title. It's possible that the bank or someone along the line neglected to include the extra land parcel in the paperwork and that's the problem that's holding up the title company - not that someone else actually claims to own the land, but that someone else (theoretically) could own the land. I know that on ours, the legal descriptions of the two parcels are the same except that a letter 'B' is added after the parcel number, so I can see how it would be easy to make a mistake when transferring title.

Call the title company and find out if they have an actual person claiming title (and able to prove they have title), or if they just have different names on the two sections of the property. It's possible that they have the bank listed as the owner of the part with the house, and the foreclosed original purchaser still listed on the extra land.

Then I would call the bank that was selling the property and see if there's anything they can do to clear the matter up. If the land is attached to the house, it should have been included in the original loan, and both the house and the land should have transferred to the bank upon foreclosure.

If someone else is actually saying that they own that land, then I don't know what to tell you. I would still contact the bank and try to have them sort it out. I think it's pretty unlikely that someone really purchased a piece of extra land attached to a property in the way you say without purchasing the rest of the property also. That person would have had the same difficulty getting title to that piece as you are having getting the other piece (if they are legally attached). It's possible that the person who was foreclosed on managed to do something shady to hold up the sale (like 'selling' it to a family member or something), but it would have taken some doing to get it past both the bank and the title company. It's way more likely that this is just a paperwork error.

[Joan.of.the.Arch]

Are you using a real estate lawyer?

Is this house a duplex, condominium, town house, or in a community with a commons next to your house?

Is the person who says they own the property an adjacent home owner?

What do you know of the history of the house before the bank owned it?

I read your blog about this, too, and don't understand how it is that you have already spent thousands on rehabbing a house you do not even own. And you have already completed a loan for it?

[TDS]

Obtain clear title

Saving advice: Firstly, you should have done your due diligence as a buyer. Not to be overly critical but it is foolish to spend your money on something if you don't know what you are buying. Caveat emptor!

Step 1: The Sheriff's office that you purchased the property through should be able to assist you. Did they somehow misrepresent what they were selling? Was this property seized as part of a criminal action? Ask them to verify what they know about what they sold you.

Step 2: You need to speak with a title attorney, they can assist you in the process for obtaining clear title. Any party with a valid claim on the property will have to deed their interest over to you.

Step 3: A survey would be money well spent, so you know what you are buying.

If you determine that you cannot obtain clear title on the entire property, perhaps you can on a portion large enough to provide sufficient equity to satisfy a lender.

Good luck - you're gonna need it!