To purchase a second-hand home without a property deed, prioritize verifying legal ownership through county records, confirming the absence of liens or disputes, securing title insurance, and consulting a real estate attorney. Engage a title company to issue a preliminary report and consider alternative ownership structures like land contracts if necessary.

Purchasing a home without a property deed carries significant legal and financial risks. A property deed serves as proof of ownership, and its absence may indicate fraud, inheritance disputes, or unresolved title issues. According to the American Land Title Association (ALTA), 35% of real estate transactions involve title defects requiring correction, often discovered post-purchase. Without a deed, buyers risk inheriting liability for prior debts or legal claims against the property. Title insurance, typically required in the U.S., costs 0.5–1% of the home’s value but mitigates losses from title errors. Data from the National Association of Realtors (NAR) shows 92% of buyers rely on title insurance, highlighting its critical role in risk management. Additionally, county recorder’s office records confirm ownership legally; failing to verify these can lead to purchase reversals or lawsuits. For example, a 2021 study by the National Conveyancer Association found that 18% of title disputes stemmed from unverified ownership claims. Thus, due diligence, professional oversight, and title insurance are essential to avoid costly legal battles and ensure a valid transaction.