What are Quiet Title Actions and Tax Deeds? - Lulich Attorneys & Consultants
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What are Quiet Title Actions and Tax Deeds?

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Title companies insure real property against known and unknown claims against the property. Anyone who buys a residence or buys real property for personal, business, or investing use – should make sure they get title insurance. Without clear titles, the buyer or owner of real property may not be able to sell the property to others. They buyer/owner may be subject to lawsuits by anyone who claims an interest in the property. Any claim against real property is called a cloud. A quiet title action helps resolve open clouds.

Sample clouds

• Judgments against the real property
• Liens against the real property
• Mortgages
• Claims by prior owners against the property
• Current lawsuits against the property
• Issues involving probate
• Disputes over boundary lines
• Foreclosure actions
• Fraud

Quiet title actions are common when there is a break in the chain of title that can’t be determined though an investigation of the deeds and other legal documents.
Generally, the plaintiff brings an action against anyone who might have an interest in the real estate to clarify the validity or invalidity of that claim.

The quiet title litigation process

Title 65 of the Florida Statutes provides the authority for quiet title actions. When the quiet title action is successful, the recorder of deeds office gets the quiet title judgment so that title companies can insure the property and owners can sell it.
A quiet title action clarifies ownership and interests of other parties. Quiet title awards do not include monetary judgements.
Typically, each defendant has 20 days to respond to a quiet title complaint. The next step is for each party to take discovery. When discovery is complete, the case is set for a hearing.

Tax certificates

Many complications and clouds on real estate arise when someone buys through a tax sale. Essentially, the buyer pays any back taxes that are due on the property. The seller of the property is usually the local municipality where the property is located. The tax collector for the municipality conducts the sale. In return for paying the taxes, the buyer gets a tax certificate
Buyers may think they’re getting a bargain, but it can be hard to sell the property unless the buyer quiets title to any open claims.
The Florida courts generally are hesitant to allow a buyer to take possession of property from a rightful owner. They allow challenges to the issuance of a tax deed. For example, Florida law has strict requirements on when and how notice of a tax delinquency and tax sale should be made.

Time to wait before getting a tax deed

The holder of the tax certificate must wait two years before they can apply for a tax deed. If the original owner of the property pays the back due taxes, interest, and costs within the two year time period; the owner is entitled to the property – and the tax certificate owner loses any claim to the property.
If the taxes aren’t paid within two years, the tax certificate holder can then auction off the property to the highest bidder. The person or entity with the highest bid is then entitled to a tax deed.

Tax deeds and the need for quiet title actions

The tax deed holder has the right to possession. He/she must then follow Florida law to pursue any evictions. The owner can’t get marketable title insurance to be able to sell the property, at any time, unless the owner also files an action to quiet title. The quiet title action must include anyone with a possible claim to the property such as anyone with a lien, a mortgage, or other encumbrances. The odds are usually high that if someone couldn’t pay the real estate taxes, they were probably in default on any outstanding loans such as a mortgage. The owner of the tax deed may have to be these outstanding bills up to the value of the real property.

Additional tax deed quit claim issues

Other clouds may include any easements on the property and any possible claims by other owners. A successful quiet claim action means the holder of the tax deed can sell the property after a short appeal time period – typically 30 days. Florida Statute Section 65.081. provides the authority for quieting title to tax deeds.

Exceptions

A holder of a tax deed may be able to sell the real property without a quiet title action – after 20 years. During that 20 year period, the tax deed owner will continuously need to pay the real estate taxes, maintenance costs, and other expenses to keep the property sellable.Before the 20-year period is up, the owner of a tax deed is better off retaining the services of an experienced quiet title claim lawyer who can file a quiet claim actions.

How an experienced quit claim lawyer helps property owners and tax deed owners

A skilled quit claim lawyer:
• Explains when and why to pursue a quiet claim action
• Researches all possibly claimants and clouds against the property
• Litigates the case in court
• Completes all the necessary documentation so that the county has the proper records
• Helps convince the title company they can write title insurance for the property.

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