When you buy a home that has been the subject of a tax foreclosure, you will not receive the same type of deed you would receive if you were purchasing the property in a more traditional way. The latter are called warranty deeds. They provide you with a guarantee that the title of the property is free and clear so you can rest assured that no problems will arise.
A quitclaim deed makes no such guarantee. As the buyer, you are not given any protection or assurance that other claims may be made on the property. For example, other liens may still be present against the home.
Steps to Take
Although the quitclaim issue may be enough to make you abandon your idea of buying tax foreclosure property, there are steps you can take to rectify the problem. You can do what is called a quiet title action. This action goes to court and is intended to provide those who would make a claim with a chance to come forward. If they do not, the court can rule all other claims are null and void so a warranty deed can be issued in your name.
If you are going to be selling the property or if you want just want the peace of mind of knowing you have an unencumbered title to the home, you should take this action on any tax foreclosure property you purchase. Consulting a lawyer about the costs might be a good idea before you make the purchase.
