Foreclosure in Chico>Question Details

Coprtop, Home Buyer in Corning, CA

Does a bank normally list a foreclosed property that they do not have clear title on? How can I tell if a listing agent is being straight with me?

Asked by Coprtop, Corning, CA Sat Aug 14, 2010

Normally I wouldn't even ask but there have been several major descrepancies in what myself and my realtor have been told from a particular listing agent and what we know for fact from other sources.

Help the community by answering this question:


Dear Coprtop, A lender who lists a property without confirming clear title to would be a very unwise decision that would lead to "who knows what" in a purchase transaction. However, that is what title insurance is for. A title company is paid a good amount of money through escrow to insure that a certain property or parcel is free of liens and encumbrances before it is allowed to transfer change of ownership.

If you were to close escrow on a home and find out after the fact that there was an outstanding lien, you would immediately make a claim with the title company who insured the loan and title transfer. They will be obligated to clear the lien or rescind the sale and refund all of your costs, down payment, fees, etc.

Title companies are typically very thorough in their chain of title searches including judgments, liens and other recorded or known instruments that could cloud title for this same reason.

Sorry to hear about all of your difficulties in obtaining accurate or reliable information from those who are licensed and sworn to be honest, ethical and responsible.

Best to you, Diane Wheatley, Broker
(909) 981-5400
1 vote Thank Flag Link Sat Aug 14, 2010
Banks and their asset management companies are not held to the same standards
as 'normal sellers'.

Banks do not have to provide most of the standard disclosures to buyers.

If they choose to sell a 'problem property' they have the legal staff and deep pockets
to prevail should you be foolish enough to waste your money in court.
0 votes Thank Flag Link Sun Oct 31, 2010
Thank you for your questions about clear titles on Foreclosure properties. Banks normally market propeties they have a clear title on because they could be liable if they did not. Furthermore, title insurance can protect you from a defective title and is generally required when you take out a loan.
0 votes Thank Flag Link Sat Aug 14, 2010
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