What Does Lis Pendens Truly Mean?
I understand that when the mortgagor files a lis pendens on a property that this is the first step of the foreclosure process. My question is, do I have the right to purchase the house and stop the foreclosure process?
I know this may seem like a dumb question, but I sent out a bunch of letters to individuals who had the lis pendens filed against them ( whose names I got from from my county website), and I'm afraid that one might actually call me! Do I need to put some kind of clause in my contract that states that I must be able to stop the foreclosure process? I know it is unlikely to happen, but do the mortagors have the right to proceed the foreclosure process and deny any contract I make witht he seller?
A lis pendens is usually a filing that is done by a party that is preventing the subject property from being sold.
I am in California and lis pendens is a method of preventing a property from being sold. Example: A buyer and a seller agree to enter into a purchase agreement and at some point the seller cancels without cause. The buyer then seeks out an attorney to file a lis pendens on the property.
Are we talking about the same thing? :-?
Lis Pendens literally means pending lawsuit. Its purpose is to put potential buyers of a property on notice that there is a legal dispute concerning the property. It doesn't prevent a sale, but puts the buyer on notice that they take the property subject to the lawsuit. No title company will touch a property with a lis pendens recorded against it.
Thanks for the replies. I think I understand. So does this mean that I could simply write a contract that states in the addendum that the sale is subject to the mortgagor accepting back payments or payoff? If the mortgagor does not, then I would no longer be bound to the contract. Is this all I need to do?
A Lis Pendens, in judicial foreclosure states, is the initial document filed on a foreclosure. In non-judicial foreclosure states, the document that gives public notice of the foreclosure is called a Notice of Default. These are the documents you will use to identify pre foreclosures if you choose to invest in them.
lis pendens - (lease pen-dense) n. Latin for "a suit pending," a written notice that a lawsuit has been filed which concerns the title to real property or some interest in that real property. The lis pendens (or notice of pending action) is filed with the clerk of the court, certified that it has been filed, and then recorded with the County Recorder. This gives notice to the defendant who owns real estate that there is a claim on the property, and the recording informs the general public (and particularly anyone interested in buying or financing the property) that there is this potential claim against it. The lis pendens must include a legal description of the real property, and the lawsuit must involve the property. Otherwise, if there is a petition to remove the lis pendens from real property not involved in the lawsuit, the plaintiff who originally recorded a false lis pendens will be subject to payment of attorney's fees as a penalty. Example: Joe Plumbob provides work and materials to Smith's home, sues to enforce a mechanic's lien, but records a lis pendens describing three other properties owned by Smith; Plumbob can be penalized by court order.
A lis pendens literally means that litigation is pending. It tells the public that a lawsuit affecting the property is in progress and that any judgment awarded in that legal action will have priority as of the date of the lis pendens. Some lawyers file a lis pendens automatically when they file a suit affecting title to real estate. The lis pendens creates a cloud on the title and can prevent a potential sale of the property from taking place.
A property owner's first remedy if a lis pendens is found, is to post a bond. If the court determines that the lis pendens was filed in bad faith, or that it does not affect title or possession to the property, then the court may expunge the lis pendens without the posting of a bond. You can take title subject to the lis pendens, but you would risk possible future judgments against the property.
You will find the lis pendens in the preliminary report together with the liens and easements which may be listed. Read through the preliminary report carefully to determine which liens or items can stay on the property and which items must be paid or settled prior to closing. Once closed, the items not taken care of will remain on the property.
Often during this period, while the lender begins the foreclosure proceedings, the owner still has possession of the property and the right to sell it. You will be able to find out about these opportunities at the county recorder's office in the county where the home is located. You could do an online search for the names of the homeowners, or you can visit the recorder's office to find them and view them.
If you buy a pre foreclosure home after the Lis Pendens is filed, you will be buying the property "subject to" any leans or other "encumbrances" on the property. Your benefit here, though, is that the homeowner might sign a quit claim deed to you, pay as little as a few thousand dollars, and then you will take ownership of the house. If you wait to buy at the foreclosure sale, any liens will be wiped out, but you must also pay in cash, usually immediately.
If you are reviewing on line in Florida courts you should also be able to pull the action being taken. The fact that a title co. will not touch these is not true. remember that is what we do ( Clear title )
If you see that the mortgage holder is filing the action do a few more steps.
1. look to see the current mortg.
while lis pendes is filed that law firm is looking to see who else may need to be notified of the pending action.
2. check court docs for any other liens posted to current owner.
this will let you know if there maybe any other payoffs to figure in to your offer.
if your math tells you this could be a good one to move forward. When contact is made remember a law firm has already been brought in, your payoff will more than likely have some additional charges.
Also as a foot note It has been my experience that ounce it has commenced the owners have a short period of believing they will save there home followed by consideration to a BK13 or 7. this is the dead time in that if they file ,a stay is placed on the action and they can not move forward with foreclosure.
yes * reguardless of your contract they can move forward, however No bank out there wants to take the house. I have a couple hundred sitting in a file cabnet in my office that still do not have public contracts on them. To the bank thats just dead money
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On 2004-08-26 18:49, johnbriscoe wrote:
Lis Pendens literally means pending lawsuit. Its purpose is to put potential buyers of a property on notice that there is a legal dispute concerning the property. It doesn't prevent a sale, but puts the buyer on notice that they take the property subject to the lawsuit. No title company will touch a property with a lis pendens recorded against it.
Of course a title company will touch a property with a Lis Pendens recorded against it. It will depend on the nature of the suite. The title company will simply want to see some sort of resolution before issuing a title policy. If it is a foreclosure, the lender will need to be satisfied at closing.
If it is a contractor who has filed a suite to be paid for some work or materials he has provided, he will have stipulated an amount that he is owed, when filing the suit. If for some reason the seller and the contractor are unable to resolve their differences prior to closing, the seller can place a cash deposit or a bond with the court, to be distributed, depending upon the outcome of the litigation.