Judgments survive foreclosure. As a general rule, judgments follow the person, not his property. Liens attached to property as a result of a judgment do not survive foreclosure if they are junior to the foreclosing lien. Senior liens might survive foreclosure.
If you are bidding at a foreclosure auction resulting from a first position mortgage loan default, you need not worry about any existing judgments the defaulting homeowner may have.
There are subscription sites that will let you search public records without resorting to a title search. Here is one you might find helpful. I believe an annual unlimited search membership is less than $50
I just spoke with a real estate attorney who advised me that any judgment attached to a person is automatically associated with the property, and that they will not issue title insurance if there are any judgments outstanding in the homeowners name.
I said that I was under the impression that the judgments follow the homeowner and not the property and she said that this is absolutely not the case.
NewKid: I have to disagree. I am bidding on an HOA lien so these judgments are not going to get wiped out. If I was bidding on a 1st lien it would be a different story.
I never said judgments get wiped out by foreclosure. I said just the opposite -- judgments can survive foreclosure. Where do we disagree?
Please clarify what you are bidding on? Are you trying to buy the lien itself, or the property that is being foreclosed upon by the lien holder?
If you are bidding on the property, and the HOA is the foreclosing lien holder, then the lien will be extinguished if the HOA takes title to the property by foreclosure. If there is a successful bidder at the foreclosure auction, then the proceeds of the sale will be used to pay the judgment and the lien will be released. Either way the lien goes away as a result of the foreclosure.
If the lien is extinguished at the foreclosure, the judgment that created that lien is not satisfied and a lien remains automatically attached to any other property the defaulting homeowner may own in that county until the judgment expires or is satisfied.[ Edited by NewKidInTown3 on Date 07/23/2008 ]
Are you absolutely sure? Why not ask your attorney whether senior lein holders have to answer the foreclosure notification (or summons) to protect their lien. Ask what happens if a senior lien holder fails to respond.
What did your attorney tell you? Are senior mortgage liens extinguished by a junior lien foreclosure if the senior lien holder fails to answer the foreclosure summons and protect their lien?
Someimes it is worthwhile to pony up a couple hundred bucks to discuss issues like this with a competent real estate attorney and get the hard facts about local law. You might even get a free initial consultation if you imply that your are testing the depth of his/her real estate knowledge to help you in choosing an attorney for future deals.
Judgments survive foreclosure. As a general rule, judgments follow the person, not his property. Liens attached to property as a result of a judgment do not survive foreclosure if they are junior to the foreclosing lien. Senior liens might survive foreclosure.
If you are bidding at a foreclosure auction resulting from a first position mortgage loan default, you need not worry about any existing judgments the defaulting homeowner may have.
There are subscription sites that will let you search public records without resorting to a title search. Here is one you might find helpful. I believe an annual unlimited search membership is less than $50
http://north-carolina.staterecords.org/?uid=91862&conversion_id=1045698132&gc_source=g&sj=QkFOS1JVUFRDSUVTLCBMSUVOUyAmIEpVREdNRU5UUyBSRUNPUkRT[ Edited by NewKidInTown3 on Date 07/17/2008 ]
Thanks I will check that site out. This is a junior lien so the existence of judgments is of great concern to me.
I am confused. A junior lien will probably be wiped out by the foreclosure and the property will convey free of this lien.
An existing judgment will follow the person, not his property. Why are you still concerned about any judgment the defaulting homeowner may have?
Is your judgment tracking system a public system available for online access? If so, would you post a link?
Also,
I just spoke with a real estate attorney who advised me that any judgment attached to a person is automatically associated with the property, and that they will not issue title insurance if there are any judgments outstanding in the homeowners name.
I said that I was under the impression that the judgments follow the homeowner and not the property and she said that this is absolutely not the case.
This is not the case in CA.
You must record an abstract of judgment in all counties and states in which the debtor owns property to get the broadest coverage.
NewKid: I have to disagree. I am bidding on an HOA lien so these judgments are not going to get wiped out. If I was bidding on a 1st lien it would be a different story.
I never said judgments get wiped out by foreclosure. I said just the opposite -- judgments can survive foreclosure. Where do we disagree?
Please clarify what you are bidding on? Are you trying to buy the lien itself, or the property that is being foreclosed upon by the lien holder?
If you are bidding on the property, and the HOA is the foreclosing lien holder, then the lien will be extinguished if the HOA takes title to the property by foreclosure. If there is a successful bidder at the foreclosure auction, then the proceeds of the sale will be used to pay the judgment and the lien will be released. Either way the lien goes away as a result of the foreclosure.
If the lien is extinguished at the foreclosure, the judgment that created that lien is not satisfied and a lien remains automatically attached to any other property the defaulting homeowner may own in that county until the judgment expires or is satisfied.[ Edited by NewKidInTown3 on Date 07/23/2008 ]
I am trying to buy the HOA lien at the foreclosure sale which would in turn provide me with title to the property and clear the HOA judgment.
My interpretation is that any other judgments under the owner are going to still follow that property.
Are you absolutely sure? Why not ask your attorney whether senior lein holders have to answer the foreclosure notification (or summons) to protect their lien. Ask what happens if a senior lien holder fails to respond.
The answer could save you $50K.
thelemur,
What did your attorney tell you? Are senior mortgage liens extinguished by a junior lien foreclosure if the senior lien holder fails to answer the foreclosure summons and protect their lien?
Someimes it is worthwhile to pony up a couple hundred bucks to discuss issues like this with a competent real estate attorney and get the hard facts about local law. You might even get a free initial consultation if you imply that your are testing the depth of his/her real estate knowledge to help you in choosing an attorney for future deals.
Chris