TAX TITLE SALES
Title Stream handles the resale of properties in Louisiana that are adjudicated through Civic Source, an online auction marketplace designed to get tax distressed properties back into the hands of the consumer. We issue title insurance policies underwritten through US National Title Insurance Company. Our policies cover any claims arising from the tax sale, as well as all claims covered by a standard title insurance policy.
The More You Know About Tax Title.
Few title insurance underwriters and agents offer affirmative coverage for adjudicated properties (properties adjudicated to a municipality or Parish for non-payment of property taxes). Historically, insuring title to adjudicated properties posed unique risks to the title insurer. One of the biggest risks involved includes, but is not limited to, original property owners filing a lawsuit against the municipality or Parish for failure to provide adequate notice prior to their property being sold at a tax sale, which said lawsuit could result in a reversion of title back to the original owner.
However, recent changes in Louisiana law have made it possible to insure title to adjudicated properties. Even in light of these changes in the law, not all title insurance underwriters will offer this affirmative coverage for the risks involved when purchasing adjudicated properties.
USNTI has agreed to issue the extra-hazardous risk endorsement, upon pre-approval of the Company’s Underwriting Department, for properties with unredeemed tax sales in its chain, whether purchased by a third-party at tax sale or adjudicated to the State or its political subdivisions pursuant to applicable law. The endorsement insures against loss sustained by an insured purchaser or insured lender caused by a final and effective judgment declaring the subject tax sale or subsequent conveyance by the State or its political subdivision to be invalid due to a constitutional violation regarding said tax sale or subsequent conveyance, including a lack of sufficient efforts to provide notice to anyone legally entitled to receive it. Also, this endorsement binds the Company to insure future sales, leases and mortgages of the property, subject to the Company’s ordinary underwriting processes, if a future purchaser, lessee or mortgagee purchases this endorsement along with an owner’s, leasehold or loan policy.
The rates for the endorsement are determined by the amount of the policy.
Please note that the tax sale endorsement will be required for every future sale for the next ten years in order to provide coverage to the new buyer.