[Taersious]

My mom is closing on a new home tomorrow. She just found out that she cannot close since a lien turned up against the home 3-4 owners back.
What legal recourse does she have?
Shouldn't the lien have been settled prior to her purchase a few years ago?

[excon]

Hello T:

Yes, the lien should have been settled before the present owner bought it. So what?

What legal recourse does your mom have?? If the purchase and sales agreement required the seller to provide a clean title, and I'm sure it did, that agreement should spell out what recourse your mom has.

She can probably get her earnest money back and she might be able to charge the seller whatever closing costs your mom has already expended, but she's not going to get much more. What do you think she should get?

excon

[Taersious]

excon,

Thanks for your response. I just think it is wrong for a title company to fail in this way. Incendentally, the title company she used to buy the home with the lien is no longer in business. As long as she isn't responsible for settling the lien, I am okay. She needs every penny to buy the replacement home and pay for moving expenses, etc.

[excon]

Hello T:

I'm confused. You've got too many "she's" going on.

There's a seller who has lien on her house. The title insurance policy she bought should still be valid. I don't know that the seller doesn't have to pay off the lien.

But, none of this has anything to do with your mother, who's the buyer. Right??

Ok, I'm figuring it out. Your mom is the seller. I thought she was the buyer.. I don't think title insurance companies can just disappear... Read the policy. And, like I said, I don't know that your mother doesn't have to pay off the lien.

excon

[rockinmommy]

The way I'm reading it, the house your mom is selling is the one with the lien... is that right??

So your mom got title insurance at the time of her purchase from a title company that is no longer in business?? Is the company that closed the sale actually the same company that issued the title insurance policy? I know a lot of the smaller, indy title companies still sell policies issued by bigger, name companies. It's just like an individual insurance agent selling different companies' insurance for auto or home. If that's not the case and they were the actual insurers themselves I wouldn't have a clue what happen.

Your mom should talk to the escrow agent/title company who is handling the current sale about it. In fact, better than talking about it - have her take the title policy in. If the title company can't do something with it they should be able to refer her to a good real estate attorney. She really will need one, most likely, for an issue like this.

I'd be VERY curious to find out what happens. Will you please keep us posted?

Karla in TX
P.S. What is the lien for? What $$ amount and who with?

[Fr_Chuck]

If your mom is selling this house, YES she is going to be responsible for settleing this lien before she can sell it. If she has title insurance, it may be needed to pay for the clearance. If it turns out to be a valid lien, this can go on for years in court though several owners.
And depending on how she bought it, warranty deed, or some other type of deed. Also if the actual lien was already placed at the time of the original sell, then it may be upheld and have to be paid.
If it was posted after the orgainaly sell, a clear title court action may clear it up.

But if she is the seller, she needs a real estate attoreny ASAP.

If she is the buyer, walk away, get your money back and find another home to buy