I am looking at a raw land deal on Craigslist (so already my suspicions are raised). It’s a good deal but not quite a too good to be true deal. Here’s my problem. the owner (from the county records) looks like an absentee owner and is contracting out to sell it - but not through a company with a website more like through a guy (friend?).
So what can I do to be assured that after all is said and done that I own the property and was not defrauded. I know the basics, no money being wired but what would I look for in a contract? If I see something notarized, how can I make sure it is valid and not via identity theft? What questions do I need to be asking?
You could ask the “contractor” for contact details to the owner. You need some sort of information (its history, particular, artifact info about the land, etc.) something the contractor probably wouldn’t know out of hand. It’s your ruse to see what the response may be. If you detect any umms, or ahhs, that should signal a scam. You should still seek the owner by yourself because if it is a scam, the owner would appreciate it.
I’m not sure where you live, but you should be buying title insurance and working with a title company to ensure that there are no liens and that the sale is properly filed with the county. Without the proper paperwork you could end up with nothing. Talking to a real estate attorney would probably be a good idea too.
In a nutshell … you, the buyer, give a neutral third-party the cash … them, the sellers, give this neutral third-party the deed … this neutral third-party does a title search to insure the deed they have is indeed legit among many many other checks …
If the deal checks out as legal … then neutral third-party hands you the deed and them the money … less escrow fees …
Never buy real estate without escrow … and I recommend in the highest levels to have a lawyer read through the documents … you worked damn hard for that money … lots of people want to take it from you … a lawyer is your friend here …
Yes, it would be very stupid to buy property without title insurance. The title company will do the research to ensure that the title is validly transferred to you. Then if something goes wrong, the title company is on the hook, not you.
I’m in commercial real estate. By and large extremely cheap land tends to have serious usability problems. Often there are issues regarding well and septic availability, zoning, environmental issues, easements on the property, liens, prior sale of development rights etc etc etc. There are lots of things that can keep a property from being developable.
Talking to local real estate agents and the local zoning office can probably answer most of the questions. Deeper issues might require a title search to uncover.
What do you know about this piece of land? (other than a cragislist descripton, which could be worthless).
I can’t conceive of buying land without physically seeing it myself.
Even if there’s a beautiful pic on cragslist-- Do you know what borders on your land?
Will it be flooded by a heavy rainstorm? What kind of neighbors? Or if it’s rural with no neighbors, what kind of non-neighbors?
Is there a garbage dump across the street?. High-voltage electric lines overhead? etc, etc
Various States have vastly different ways of conveying real estate - some require/required a real lawyer to handle all the paper.
IN CA, the Title company can do almost everything (the Realtor acts as your agent to the Title Company) - they are the ones who do the escrow, and, I take it, the title search.
They also arrange the title insurance.
It is the title insurance which guarantees your clear, unencumbered ownership.
Those policies are not written without a title search - things like unpaid Property tax, Court cases awarding the property to another following a dispute, “well, we really don’t know where the line is along the back…” are a few of the encumbrances which can befall real estate - esp. raw, undeveloped land or little commercial worth.