If so, beware the contract clause directing you to use the seller's choice of title insurance company.
Why? Foreclosure attorneys sometimes make mistakes. The title insurance provider selected by the seller may be inclined to overlook mistakes and move the transaction to a quick settlement.
What kind of mistake? Well, some foreclosure attorneys don't understand how to deal with federal liens. We had a case in which there was a rural housing 2nd mortgage. The foreclosing attorney did not give proper notice. After the foreclosure had taken place and the purchaser were moving towards closing, the federal government started their own foreclosure on the 2nd. Luckily we were involved and had discovered the deficiency in time to resolve the matter, but what might have happened if the buyer had closed quickly using the seller's title agent?
Well, you could argue that because they were insured, the title company would take care of the matter, but do you really want to have to deal with trying to get someone to help you stop a foreclosure and do you want to deal with the stress of making a claim?
Good title insurance practice is about finding potential claims and eliminating them PRIOR to closing.
I recommend that you hire your own independent title insurance agent to vet the foreclosure transaction and make certain you are truly getting clear title.
Be extremely careful buying property that has gone through a foreclosure.