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How Good is Your Tax Sale Title?

When it comes to Tax Sales the investor should be guided by the ancient motto “Caveat Emptor,” which in Latin translates to “Buyer Beware.”

There are two main reasons for this:

JohnMenszer2-Crop_-80661) When a property goes to tax sale no one has checked for prior clouds on the title; and 2) The tax sales are often conducted in such a manner that legal notice is not received by the former owners.

When I take a tax sale case the first thing I recommend is a title search. This should reveal the title issues that could be problems later. Next, I make a governmental request for documents that show the steps taken to notify the former owners of the sale. These notices state that the owners are about to lose their property if they do not pay the taxes before the auction. On lucky occasions the record shows that the owners actually got notice, but often it cannot confirm that the notices reached them.

Now a word about titles. The gold standard is a “merchantable title,” which means, not a perfect title, but a title unlikely to lead to litigation. A merchantable title is readily transferrable and a reputable insurance company will write a policy of title insurance on it. The latter is important because most mortgage companies require that a title insurance policy be issued to safeguard their loans. They will not make a loan without the title insurance. It has been the case in South Louisiana that reputable title insurance companies will not issue policies on tax sale properties.

I look at a the purchase of a tax sale as an investment. The tax sale purchaser will have to determine if the risks justify the rewards. Whether, the defects in the title, if any, and the lapses in the notice process, if any, justify the financial risk.

High Tech Zoning Tool You Should Know About

 

 

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The City of New Orleans website has a cool new mapping tool that allows you to zoom in on any lot in Orleans Parish and obtain up to date zoning information.

You can:

• View the city in satellite imagery or as street map.

• Search by street address or drag and click on a location.

• Create custom layers that show lot, square, zoning and future land use.

For each lot it will tell you the zoning designation, description and when the map was last updated. Click on each item for more detailed information and a link to the zoning ordinance itself. Check your neighbors. Check yourself. Check the commercial development on the corner.

The Comprehensive Zoning Ordinance is the “blue print” to new developments in New Orleans real estate. Last updated in the 1970’s a new ordinance is in the process of being adopted. It will afford predictability and uniformity to what has been an ad hoc process of appeals for each non-conforming use and waiver. The goal has been to balance comprehensiveness and simplicity, so that the average citizen can understand it. High tech mapping tools have allowed the City to analyze neighborhood patterns of use as never before which should lead to fairer and more just decisions.

You will find a link to the Planning and Zoning Lookup Tool on the City’s website at:

www.nola.gov/city-planning/planning-and-zoning-lookup-tool/