1- There is probably a mortgage on the home and in order for the home to be sold- the best course of action is if the sellers would agree to cooperate and conduct a short sale- then that would be your most appropriate solution-
2- Nevada does conduct Tax lien sales- where you purchase the tax lien and then wait for the mortgage holder to redeem and satisfy the lien- thus paying you a large percentage on top of the balance- If the bank did not redeem the tax lien- then at some point - and you would need to consult an attorney on this- my belief is at that point the mortgage can be severed from the home and you can own the home for purchasing the tax lien- but the fact of the matter is, the bank would make up the taxes and payoff the lien, before that situation were to happen-
3- If the sellers have not interest in the home and no interest in conducting the short sale, and you have a legitimate lease for a certain period of time, then if the bank were to foreclose, they would have to honor the lease and allow you to stay at the going market rents- At which point in many cases the bank will give you the tenant an opportunity to purchase the home at todays market value-
Contact me and I can help walk you thru any of these situations in more detail.
Barrett & Co., Inc.
(702) 592-9510 mobile
Perhaps the real question should be: "Is there a way to put a silver lining into this dark cloud?"
At best, all that happens from the Owner of the property quit claiming the property to you is that you delay the inevitable. The lender is going to foreclose on the home (regardless of the status of a tax or sewer lien)...of that you can be sure. It is only a matter of time. In fact, if they haven't already, the Lender will be paying those liens in order to protect their interest in the property. When that (Foreclosure) happens, the property will be listed and in all likelihood, because of the market we are experiencing right now, will get into a bidding war and sell above market to a cash buyer.
So, how do you turn this into a good situation for both you and the current owner? Your best bet is to persuade the Owner to enter into an agreement with you and cooperate in a short sale. It is to their advantage as well, for the following reasons:
1) Historically, the Lender will net more under s short sale than with a foreclosure. This means a lower deficiency to the current owner, which means (if they have not lived in the home for 2 of the past 5 years), a lower tax bill to the current owner. The IRS sees this as forgiveness of debt and therefore an income event to the owner. Additionally, a lower deficiency means less for the Bank to pursue. More on that in a moment.
2) If this home was used as the primary residence by the current owner in recent past, they may be eligible for a small cash incentive from the bank to complete the short sale. Although it is rare, I have heard of this for investment properties as well.
3) When the Bank forecloses on the home, there will be a very large deficiency, which in the Sate of Nevada the Bank will have the right to pursue against the Owner. We are now successful in most all cases at getting the bank to waive that deficiency altogether. This means no collection agent coming after them in the future.
4) Their credit is hurt less, and recovers faster under a short Sale as apposed to a Foreclosure.
5) The obvious advantage to you is that you will be that at the end of the day the new owner of the property.
Successfully negotiating a short sale requires a certain amount of finesse and tenacity. An agent with relationships is helpful as well.
As for the question of paying the paying back taxes and sewer liens, there is absolutely no benefit to you either now or in the future to do so, so I would not pay those.
If I can help, or answer any questions for you, please don't hesitate to call or email me.
Best of Luck, and thanks for reading.