A valid strategy in real estate investing involves the purchase of properties at a discount because they have title problems or a clouded title. The investor can hopefully purchase the property below value, correct the title problems and then sell it at a profit. These clouded title issues could involve:
Federal, state or local tax liens
Liens for work done on the property
Missing heirs with possible claims on the property
Boundary or survey disputes
Other claims on ownership
The critical aspect of this investment strategy is to be sure that there is thorough research into the title problems, preferably by a title or abstract company or attorney who specializes in title searches. Once you've identified the problems, then you need a qualified attorney to give you an accurate idea of the cost to correct them. If doing so still leaves you with a property you own below its real value, then you probably have a good investment.
