Quiet title actions are filed in court. They resolve all of the outstanding liens on the property and allow the owner to sell the property free and clear. Quiet title actions are often used by people who purchase property at tax sale, foreclosure sale, sheriff sale or estate sale — people who obtained title by a quitclaim deed but want to sell it by a warranty deed.
Most mortgage companies require purchasers to have a warranty deed — and title insurance — before the mortgage company will fund a loan on the property. Quiet title actions are the court procedures that allow investors to do just that.
1. First, the owner orders a title search of the property.
2. Second, the attorney reviews the title search and prepares the court action — or Complaint — naming any person or company that has an interest or a lien on the property. The action is filed in the court in the county in which the property is located.
3. Third, the clerk’s office issues notice of the action (service) to everyone named in the Complaint. Indiana rules of court allow at least 23 days after receipt of the complaint for the defendants to respond to the complaint.
4. Fourth, the attorney verifies that everyone has been properly served. If anyone has responded to the Complaint, we attempt to negotiate the payment of the lien in coordination with our client. For example, if a listed mortgage company responded, we would attempt to find out how much they would demand in order to release the lien. Mortgage companies don’t always respond — but they could. The client needs to know that this possibility exists.
However, often times we have difficulty giving notice of the law suit to everyone listed in the title report. The delays caused by trying to find people can add another 4 to 8 weeks to the process. This is also a place where additional legal fees can be incurred.
5. Finally, the attorney files a motion for judgment to complete the case. If everything is in order, the court will sign the order for judgment. We provide the order and any other documentation to the title company, so that they can issue a title policy
The big questions we get: how long will it take? How much money will it cost?
Title actions can be completed in as little as four weeks. On average though, they take closer to two to three months. Legal fees can also be in a range — anywhere from $1,500 to $7,500, depending on the number of lienholders, whether or not the lienholders respond to the initial complaint and how much work is involved to resolve the issues.
If you have additional questions about quiet title actions, or would like to have us handle your case, please contact us at kathy@Kjdlegal.com or call 317-721-5290.