Q: Tax Lien Auction caused by Settlement Company recording error. Who is liable?
I am the buyer and the Settlement company we hired incorrectly recorded the mailing address for Grantee/Buyer on the Government Intake form.
Due to the address error, important mail and tax bills were undeliverable to the Buyer and returned to sender. I confirmed this with our County Treasurer. I was not in receipt of tax bills and tax delinquency notices so my parcels at this closing were sold at tax lien.
I discover this after suspicion of why no tax bills were being mailed and immediately redeemed ownership of parcels after $3,000 in fees and penalties.
I wrote a demand of payment letter to the closing company but they denied liability. Title Insurer also denies coverage because they only cover claims "PRIOR" to closing. They offered a small payment as a courtesy, but not nearly enough for the damages.
How would you respond to the title insurer to come to a more favorable resolution? Seems I have run out of options so I am reaching out for some guidance.
A: For a dispute over $3,000, your remedies become as expensive or more expensive than the loss. Absent a negotiated agreement, you must sue: Either for coverage under the policy, or the title company for negligence. You might also pursue a claim against the insurer in the Maryland Ins. Admin. The practical obstacle is your legal costs, which might not be recoverable.
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