We sold a house and the buyer is in foreclosure with his mortgage. There was an error on the books (house number wrong). The address is correct on our settlement papers. Lawyers call us and say that we need to sign a quitclaim deed since we have no interest in the house and because of the error, it's as if the buyer never purchased the house. We are to sign the quitclaim as the guarantor and we are relinquishing our claim to the Mortgage company.

What happens if we don't sign the quitclaim deed? Could we possibly be in a position to buy the house at a reduced rate now that it is in foreclosure and we make a good profit on it?

Thanks.

First no don't sign anything, without your attorney who did the sell of your home, or another attorney looking over as to why.

Normally on a deed, there is a legal description, used, ( and it can be quite long,) If this is just a issue of clearing the deed of record, they can do it though their own legal court action to clear the title of defects.

I would say no, you don't sign without talking to your attorney, this may be an illegal action to short cut the legal foreclosure.

The attorney that sent us the quitclaim deed is the same attorney that was used in the closing of the house. We used the same attorney as the buyer.

What will happen if we don't sign it? I don't want to pay for an attorney.

Thanks for the advisement.

Well your contract and deed is with the buyer of your property, not the mortgage company or the foreclosure people. So it is to them, that you owe any duty. If you sold it to them under a warranty deed, you gave a warranty that the title would be clear and marketable, so they may come back to you, if they wish to have the title cleared and you would be responsible to do it. But if you did not sell it under a warranty deed, it will all depend on what warranties you included in the sell.

But you are obligated to clear the title to the buyer, and if you sign anything to ownership of the home to anyone else but the buyer, you may have some liablity to the buyer.

If they wish to have you sign a deed over to the buyer, and they forclose on the new deed, that could be done, or they will have to have the buyers sign a relase to allow you to do this.

** buyers and sellers need separate attorneys, to protect each of their interest. An attorney should be representing one or the other in the sale,

I guess my issue is all the red flags that come up when someone asks me to do something that may be improper and I am not sure, When I doubt I normally would never sign anything until I was completely satisfied about what was happening

Quote:

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Originally Posted by Fr_Chuck

I guess my issue is all the red flags that come up when someone asks me to do something that may be improper and I am not sure, When I doubt I normally would never sign anything untill I was completely satisfied about what was happening

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Great Answer!