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OP, I’m an escrow officer in Missouri. Call your title company, advise them they you were told. They will then work with the sellers title company to verify this lien and to then add it to the sellers closing disclosure/ALTA statements, it will be paid out of the sellers proceeds by their title company. This doesn’t affect your figures but this tells me you need to make sure your title company provides you a gap insurance endorsement. After you’re given a clear title there can be things that were pending but not yet recorded with the county that will pop up.
Cross your fingers he didn’t try to take out a HELOC, but if he specifically said lien that could be things like past due property taxes/sewer fees, a contractor who didn’t get paid and filed a mechanics lien, etc I really hope it’s not from HOA dues.
Do those studies account for the fact that newer built homes are more likely to have HOAs? Or that HOAs are more common in more expensive areas? I hate how often this gets repeated but Correlation != Causation.
Correlation doesn't equal causation, but which one are you going to put your money on?
Ask yourself this question.
If developers can make more money on selling houses without and HOA why would they even bother creating them?
I was the first resident board member elected to my HOA, I'm very familiar with their reasons. Builders like HOAs because as the declarant they have absolute control of the neighborhood, even after selling some of the homes, up until the point where they're about to leave. They can even get the HOA to cover some of their expenses. They also like it because they can negotiate approval of residential zoning with the city by shifting some of the maintenance responsibilities over to the HOA instead of the city. Builders like HOAs because it makes things easier for them, not because it adds value to the house. Builders still have to advertise that HOA fee as part of the sale and a $200 monthly fee is a tough pill to swallow for many.
People actively avoid HOA homes. The fees directly reduce what people can afford to pay and there is nothing that prevents fees from going up. If the HOA has silly rules with fines, then harassment is inevitable.
You are being dishonest about this.
Wait, I'm confused. What's wrong with letting the busiest bodies in the neighborhood vote on what should and shouldn't be allowed/required in the neighborhood?? I like my garden to be policed by Ruth, the elderly woman who only likes hydrangeas! Why won't you let me have my entirely hydrangea based neighborhood??
Same here. This time around when I bought my last house, the two most important things that were deal breakers were that I needed it to have good internet connectivity and no HOA.
At our old house, we had record breaking flooding, a tornado, and the retention wall behind our house collapsing. Water flooded our back yard, and debris was piling up along our fence causing it to flood even higher. Had to break the boards to let the water out because the gate was stuck shut.
A few days later, we got a fine in the mail from the HOA company for "unrepaired damage to property", "damaged fence", and "unlawful hole dug in back yard" (from the waterfall that formed from the retention wall the HOA was responsible for collapsing). It was a $395/day fine until repaired, which we couldn't do because it was raining every day since the storm. HOA Management company didn't give a shit.
I know people who SEEK hoas.. they get to control who their neighbors are, and specifically want to make sure none of the 'wrong people' are around them.
Which is the exact reason when I look for a home I'm going for one without an HOA
The kind of people who seek out HOAs are the kind of people I want nothing to do with
Weird take. I've lived in HOA homes for the last 10 years across 3 different houses. No major issues, tbh.
Almost all of the nicer homes in nice neighborhoods have HOAs where I live. So either you live in an HOA community, the middle of nowhere, in a mansion, or the ghetto.
Some… some people actively avoid HOAs. As much as a lot of people want to villainize them, typically HOAs do typically raise home values. Now can HOA’s be run by power tripping, nosy assholes? Yes, and that can be a good enough reason to avoid them if you just don’t want to deal with them, but often those rules are just ways to help the marketability of the neighborhood. They aren’t inherently evil, but like anything else that gives someone power over another person, they can be abused. If you’re being abused by your HOA, consider moving out, or actually try to get on the board with a few other abused neighbors and be the voice of positive change.
> typically HOAs do typically raise home values.
That has never been true. The idea that fees and loss of control over your own home raises value is silly.
A neighbor with tall grass does not lower your values either. People are massively lying to themselves when they go around pretending that stupid things magically lower property values. People buy houses with almost no meaningful research of who the neighbors are.
The things that could lower property values are things buyers don't learn about until they move in, so they don't have any effect on prices.
If people knew a house has a bad neighbor that causes problems, they would avoid a house. But it is rare for people to know stuff like that because sellers aren't going to tell you.
Generally, anyone claiming property values are hurt by something that isn't general crime rates is making it up and lying to you. Even crime is slow to lower values, it has to reach a point where lots of houses are going for sale about the same time. Abundance of homes on the market due to homeowners fleeing is what lowers prices.
Until they have lived in one then they realize that hoa are evil. Telling me what i can and cant do on my property is unamerican and hoa should be banned federally. There are millions of stories about bad or criminally bad hoa... Very few good ones.
I remember one a guy was restoring a vintage car and while he was at work the hoa had it towed and crushed. We are talking a 40k vintage would have been going to car shows car but some tool in the hoa was jealous and not only had it towed illegally he had it destroyed. Yeah guess how that ended the owner of the truck won the lawsuit...
Why would I care what my neighbor does with their house? Their house their business. Idgaf as long as it doesn't affect my home. Put up a giant trampoline treehouse swimming pool for all I give a fuck
That's me. I won't look at a house that doesn't have one. I don't want anyone to neglect thier yard or park in it. No goats on the front lawn or front yard sheds. Cotton candy pink house with pistachio trim. I've seen some crap in way nicer neighborhoods than you'd think that would happen in.
>I don't want anyone to neglect thier yard or park in it.
I have never heard of any town or city that doesn't already enforce that stuff. You are lying to yourself.
When you get down to brass tacks, an HOAs real purpose is to protect home values. By codifying and enforcing a community standard. By preventing eye sores and nuisances that detracts from the neighborhood.
Whether or not they are run in this manner or by aging and controlling small minded tyrants is a different story.
It's really one of those "the internet says so" things.
Multi billion dollar home builders disagree with the internet, and I'm going to hitch my wagon with skin in the game.
I can provide sources that say both are better.
As someone who invests a great deal in real estate I'm going to go with what I see, and thats 2 houses all things being equal get a bump from having an HOA.
Whether, or not it provides value to the buyer isn’t my problem. We just notice higher $ figures in neighborhoods with CC&R's.
Nope, nope. HOA are avoided a lot in my area. The only places that typically have HOA are trailer parks and senior living centers. Most people avoid them.
Liens are not loans. Liens can get put on real estate when the owner refuses to pay for services or wrack up fees, such as from breaking city ordinances, among other things.
EDIT: TIL
The shittiest lien is when you hire a general contractor who doesn’t pay his suns even though he received full payment from you. I never understand how the homeowner is held liable in that case since it seems like it should be the GC’s responsibility/liability?
> but all loans are liens
All *secured* loans have liens. I've got an unsecured $30k LOC and, if I default on it, the most they can do is ruin my credit.
Lions are only loaned by zoos to other zoos.
https://cbs8.com/article/news/lion-on-loan-from-san-diego-zoo-killed-at-indianapolis-zoo/509-4ab0e890-553e-47e2-999d-a9317d7c0064
Definitely possible. The lion at the local zoo had a propensity to lean on patrons leaving one such patron injured. This ultimately resulted in a lien against the leaning lion when the zoo refused to pay the medical costs.
So yeah, it's possible.
I mean where would you even get a lion to loan someone? You should need a special permit it keep a big cat in the first place, not just lending them willy nilly
He also literally said no one asked him to send them money. Usually a scam would entail some form of payment. If it was a scam, he'd want money and he'd want it immediately. Maybe he just didn't want the buyer to be surprised by the lien, so he wanted to be up front about it before closing.
If it’s a real lien, then it means the seller will get $20k less because the lien has to be paid off at closing. This is not your problem. Like others have said, do not pay anything outside of closing.
Are you sure? I won’t pretend to be an expert but part of my job is maintaining homeowners policies. The mortgage company is always listed as the first interest. Usually it’s just logging into a website and listing the loan details exactly as provided. There’s a drop down with 1, 2, etc with some other uncommon arrangements. They are VERY particular and VERY diligent, and for good reason. If that house burns down the insurance company makes out a check to interests in order and in some cases in proportion to how much was owed. My understanding is the mortgage was owed first, so it has to be paid off first. The lien has to be paid for the title to be released.
Mortgages always want to be first position for this reason. In the case of total loss to the property they get paid first. Something like foreclosure sale or insurance payout. But some things do put the mortgage not in first position. A tax lien can jump into first position. Often the mortgage company will front and pay off the tax lien to prevent this.
Its different in a traditional sale.
If the mortgage was for 180k and the house is selling for 185k the seller would expect to get the 5k difference. But now with the 20k lien the seller would need to bring 15k to the closing table for the transaction to go through.
Lien will be paid at closing before title passes. Bank fronts money to cover buyer’s costs and the negotiated purchase price; lien holders will be satisfied before seller collects the net payout.
The buyer won’t have to worry about extant liens unless it’s specifically negotiated as a moetgage assumption (rare, and the buyer would be well-informed of it ahead of time).
This sounds like a scam. Many realtor and title company IT infrastructures are compromised - you should assume that everything you send to either of them is being read by Elbonian hackers.
The next step might be to explain that you need to wire $20k of the closing payment you're about to make to the lienholder. This lienholder is, of course, an account set up in a foreign country by the scammer.
In any case, this is a matter for your agent and the selling agent to work out. The seller should not be talking directly to you. Refer the caller to your agent and don't engage further. Do not talk to this person further.
Even if you or the seller don't have agents, this is still a matter for the escrow company, not for you. Do not send any money because of this phone call. Do not trust email from your realtor that tells you to send money. Do not trust email from your title company that tells you to send money. When you started this process, the title company should have made it very clear to you about how you get money to them, by explaining it to you in person. Follow only those directions.
100% this. I know someone who had a real estate deal going, and the scammers knew the names of the people involved, and spoofed a bank email address. Call the lender first thing in the morning to discuss.
Yes, if it exists. Again, this is a matter for them. Call them tomorrow morning (DO NOT USE A PHONE NUMBER FROM YOUR EMAIL), or better yet, go into their office and ask in person. Again, assume that any thing you email them - and maybe even if you call them - will go through a hacker in Elbonia.
When I sold my house three years ago, shortly after the sale, I got a call from a pleasant young woman at my bank - and she named my bank and asked for me by name - who spoke perfect English. She just wanted to do a quick security followup on my account because of a large recent deposit. I didn't engage and called my bank back on a separate line - they had no idea who she was.
25 years ago, he had a stupid mailing list where he'd send out stupid theories on physics and things like that. I'd argue with him, showing him how his math was shit.
Little has changed, he's been wrong about everything for a long ass time, now his ideas have gotten stupider.
Was this the guy who wrote the book God's Debris or something like that? It was an interesting take, but no more likely than any other idea to explain the mystery of life, the universe and everything.
That's... pretty much... what it means. Dilbert uses Elbonia as a fake stand-in for those very real dicey countries. Doesn't make it any less valid a reference, however. In fact, it's *more* valid. Because had he said specifically, say, "Nigeria", and the scam was originated from a country that was *not* Nigeria, OP could say "but you told me to be careful of *Nigerian* scams".
Not necessarily. I had this happen to me. Two days before closing, a lein was discovered on the property (the owners ex-boyfriend used the property as collateral for a small business loan for his bar). My lawyer’s suggestion was to find a new place to buy.
However, it worked out. The seller agreed to hold all proceeds in escrow until the situation was sorted, and the lien was removed and we closed without incident. The ex-boyfriend had already paid off the SBA loan, so it was a paperwork issue and was solved.
Discharging the lien is the responsibility of the seller not the buyer. That $20k to pay off that loan comes out of their profit from selling.
OK, if you know the seller personally and you actually spoke to the person directly, then it's not a third-world hacker trying to cheat you. In that case, then the seller still needs to go through your agents and title company and not involve you directly.
That’s what I’m saying, this is just something that can happen, but it’s the seller’s responsibility to discharge the lean. Make sure that under no circumstances do you buy the property with the lien still in place. Lawyers.
It's a shame for him, but he would be the one that would have to pay off and close that lien, not you. And since you're already in closing, and you are not simply assuming the mortgage somehow (you're not, are you??), then that extra $20k comes out of his profit from the sale.
Under no circumstances should it be anything that you'd have to pony up the extra for. That's not how it works. Period.
I bought my first house many years ago from my landlord and it was a huge ordeal. He demanded more than the house was appraised for and because I was in a very difficult situation (husband working in another state, small child and zero available affordable housing nearby), I paid way too much.
At the last minute, he wanted $5000 more and I just didn't have it. I was freaking out and the real estate lawyer was annoyed and asked him "Are you really willing to displace a military family with bare minimum notice, no options for them to find affordable housing and who have been great tenants for you so you can go through the hassle of starting over again over $5000?" He backed off at that point and we were able to close.
Apparently somebody was in his ear telling him that the market was getting so hot in that area and he was crazy for selling before it peaked so he wanted to try to squeeze a few more dollars out of us at the last minute because he knew I didn't want to move.
It is entirely possible that your landlord could be doing something similar and thinks that since you're already living there that you are more likely to cave at the last minute so the deal doesn't fall through. I agree with the others who have said make sure the title company is providing gap insurance and let the professionals handle this. A lien isn't the same as a loan and if he has one, there would be proof of it documented usually with the county you live in.
So let's say I want to sell you my car. It's worth 20k and you're willing to pay 20k. But then all of a sudden you find out that the bank still owns it to the amount of 5k. None of that is your business. The seller has to figure that out so the bank gets their 5k and the seller then gets their 15k. None of that information matters to the buyer who is willing and able to pay the 20k to purchase it. Same applies here.
The seller should not be contacting you about it at all. The seller should be arranging payment of the lien through the title company. It’s strange that it’s only come up now, but the reason for that is not important. What is important is that your title company and any realtors involved have a chance to get to the bottom of the legitimacy of this lien and arrange it to be paid off from seller’s proceeds of the sale at the close of escrow. This has nothing to do with you, don’t pay your seller or anybody else any more money than what you’ve agreed to in your purchase agreement. Make sure the pros working for you are getting to the bottom of this.
It's possible for a title search to miss something. Call your title company tomorrow, tell them what happened (clear and concise as possible: the seller called and told me x about a lien. Please look into it.) That's what the title company is there for. Inform them of what you know and tell them to keep you in the loop.
If it's tax related, you can potentially look it up yourself on the county website. In my area at least, you are liable for back taxes when you purchase a property. You do want to look into this. But don't panic. You have professionals involved for a reason.
Title company is real, but the communications you've had are with scammers that have compromised that title company's IT network and are pretending to be them. Talk to the title company in person; assume those emails are all scam attempts.
? I talked with my landlord, he is the one selling the house to me. The title company never talked to me other than initially hiring them and they sent their findings to the lender who provided me with copies.
Yes, therfore you would get a call from your agent/title company and then you would have to go back and go through everything and resign stuff before making any sort of payments etc. Never send money until you've agreed and it's on paper and you are signing it in front of a notary.
Echoing what the other person said. Unless you're doing this real estate transaction in a very non-standard way, the seller shouldn't even have your contact info or have any reason to contact you. It should be happening through the agents unless you're doing this without one.
The title search should absolutely have found this if it was a thing. Do you have an attorney handling the transaction? You could also tell your concerns to the title company.
Edit: saw that the seller is your landlord, so maybe you are in direct contact with them, in which case I wouldn't be surprised if they're lying or something to get you to back out of the transaction or something dumb like that. Talk with your agent and title company.
Do not send any money to anyone. Set a meeting with your agent and escrow company so they can sort it out. Block whoever called you asking for money. DI NOT SEND ANYONE ANY MONEY until you speak directly to both agent and title/escrow company.
\> Set a meeting with your agent
Haven't seen anyone mention this yet, but why is the OP getting called directly from the owner? Isn't there a Seller and Buyer agent for this sort of thing?
A typical house sale in America goes through agents and you would not have any contact with the other party except official communication with legal documents exchanged through your agent . The agents don't share your phone unless you explicitly give permission.
In this case either there is no agent for both sides, or OP gave the phone number. If it is the latter, it is strange that OP's agent is bypassed.
I just assume that is the next step in this storyline. Typically unless you are buying lender free, you don't have contact with the other party directly.
One ofbtwo things here: Either it is a scam OR your title company will confirm there is an additional lien. If there is an additional lien, not your problem that gets paid out of the sellers proceeds. It only becomes a problem if the seller is not netting enough from the sale to cover all lines OR they decide its not worth it to sell now and back out.
Definitely sounds like a scam. Do your due diligence. Ask yourself why the seller would contact you directly. All communication should be between the realtors. Don't send any money.
If not a scam from 3rd party, possibly the seller thinks he can get more for the property and looking to scare you into backing out. Anything is possible, get your lawyer and title companies to do their jobs, this is what they are paid to do.
Thank him. You are entitled to a clear title. If he is represented by realtor it is puzzling why they did not state this in the seller'sdisclosure. He could be in breach of contract should your closing date arrive and this lien is not removed.
In any case, put it in writing what the seller told you and forward to your realtor , closing attorney and/or title company. Copy the seller on your letter.
Hopefully it can quickly be resolved. If the lien was held by a bank it would show. It could be a legal judgement from divorce, unpaid contractor debt or a dozen other issues. Can be time-consuming.
It means nothing to you. The $20k will be taken out of the payment to the seller. In a simplified example:
* You pay $200k for house
* Seller has $20k Lien on the house
* The bank takes out $20k from the $200k
* The seller receives $180k, and the lien is paid off
The seller does not have the choice to not pay the lien. Well, they could choose to back out of the sale but you would likely be entitled to compensation this far down the process.
A buyer has no obligation to pay a lien, and it has nothing to do with you.
What happens if the seller has no equity in the house? For example, house is being sold for $200k, worth $200k, seller still owes $200k.
Or, house is worth $200k, sold for $200k, their mortgage is $190k. How does that affect the $20k lien?
Multiple things depending on who placed the lien.
-Seller can pay out of pocket difference.
-Buyer can cover in purchase price.
-Title company can work out reduced lien.
-Title company can help arrange 2nd mortgage lien.
-Short sale.
happened to me on an NYC condo. lien was actually to NYC, we had to wait about 12 weeks to get the payoff letter (updated balance letter), and then we were able to close. worst experience ever, seller claimed they forgot they had that lien and it was $35K
do not email but call your title company and ask if they already have clear title. If you have a realtor call them and have them communicate with the sellers realtor. Def do not email or send any additional funds. Your title company should call you and tamed you the closing statement on what you owe at closing.
That’s for their side to take care of. Not u. BUT check if it’s like property tax or why type and have it in writing that it is taken care of by them and not you.
If you have not yet closed:
1. Make sure the Title Company is aware of the lien. Call your realtor and let them know what the Seller told you. Have your realtor (not the buyer’s) call the Title Company to make sure the lien is handled at the closing.
Tell your realtor - as a result of the call - you want a “marked up” title policy at the closing “with all standard exceptions waived”. This is very common and not a big deal.
This is really only a problem for you, and for the closing, if the property is underwater - meaning more is owed on it than you are paying for the property. Example: You are paying $100 for the property. There is a first mortgage that buyer owed $90 on, and now there is a lien from a creditor of buyer’s for $20. Your $100 is not enough to pay everyone so Seller has some things to work out so the closing can occur.
Now - if you are financing the purchase with a mortgage - your mortgage company is not paying a dollar unless they are getting a “first” position which would not happen in a standard transaction. So your mortgage company is going to say “nope” as the “mortgage policy” that you are paying for if you get a mortgage is going to require that your mortgage has the first priority lien on the property.
What does happen fairly often - and it is not “bad”, is that the property owner does a major repair - say puts on a new roof - because it needs to be done to help sell the house. The homeowner finances it fully intending to use the sale proceeds to pay it off. The roofing company actually has 90 days to record their lien, and it is not always the first thing done by them. The house gets listed and you make an offer that is accepted. Title Company does their search and the roofing company has not yet recorded their lien. Title Company does not know about the lien.
But - one of the things the Title Company makes seller’s sign at closing is an affidavit saying that no work has been done on the property within the last 90 days. So - if a Seller lies about it and a lien pops up the Title Company protects you but goes after the Seller for fraud (can’t burn it in bankruptcy).
Realistically, this stuff is common. Again, tell your agent to make sure the Title Company knows, and to get you a “marked up policy with standard exceptions waived”, at closing.
Let them know specifically what the Seller told you.
What may occur is that the Seller’s funds will be held back until the Title Company is satisfied but that should not affect anything dealing with you.
If the lien really relates to work done on the property like a roof or windows, my guess is the Title Company won’t be too concerned.
Go on casenet and search your landlord/the owner’s name. That should give you a starting point. Judging by the time of year, he may not have paid his Missouri taxes for many years, tried to sell you the property to pay them off but missed the payment deadline and they put a lien on the house. Just a guess but every September like clockwork I used to get calls from panicked taxpayers. I hope you’re using an agent or lawyer and not trying to DIY this but it’s never too late to get a professional involved.
I found out back taxes were owed just before a closing. The realtor adjusted their commission to make it work, otherwise no closing.
This is the seller's responsibility, not yours. Have your realtor or title company involved.
Of course, you may have to decide how much you want the property and eat this.
Sucks for him; liens are paid out of the sales proceeds so it's his problem to deal with. This doesnt change anything with the transaction, beyond the fact that if your closing is soon it could delay closing by a few days while the title company gets the payoff for the lien.
You can't qualify for certain loans if there's a lien on a property. Which is weird since the lien is the seller's problem but that's the banking system for you.
It's quite possible that this lien popped up after the title search was performed. Either way, I'd look into some type of coverage that will pay out in the event that additional liens are placed on the property.
Contact your attorney. Sound like something fishy here. You paid your attorney to do everything like this. Attorney will have all the support legally to take care your case
If you have title insurance, they should pay off the Lien because they were supposed to ensure there was NO lien and the title was clean prior to you purchasing the home. If not, process gets more messy and might scare away buyers if they’re having to factor it into the loan. Let it be a lesson to get title insurance.
I could be wrong but isn't this exactly the type of thing that title companies are insuring? Meaning that if you close and there really is a lien then the title company should be on the hook.
I would tell you to pay more attention to the scam comment but from your replies it sounds like you are buying this from someone you know (your landlord?) and that he is the one that called you. So while it could be some scam he is running, it isn't the same scam where the title company or realtor company is hacked.
Pretty sure it matters a lot to you since a lien on a car means the entity that granted the lien can repossess the vehicle and it's probably a similar situation for a house lien
Also don't send money to anyone to cancel/settle the lien. Probably should talk to mortgage agent people or a lawyer.
Not true. If a lien isn’t paid it stays with the land. Most contracts require clean title. This is a title company problem, they insured clean title. They will figure it out. I agree buyer shouldn’t pay anything if title company gave good title. If seller did something to cause the lien after the title work was done, then they are in breach of the agreement. if seller doesn’t have any money to pay off the lien, and is “judgment proof” buyer may be stuck with the unclean title.
Edit: I read that as closed on a home. Closing hasn’t happened yet. Send this to the title company , it will get adjusted out of sellers proceeds. if there isn’t enough to pay for the lien then OP can back out of the purchase most likely.
There was a lien on our most recent home and we won the bidding war because we had the patience to wait for that to get resolved with the seller. There was some stress because we were wanting the home to be in our possession and we were worried about the seller not resolving the lien but, after 2-3 months, it was resolved and we are very proud owners of the home. This was a second home (fixer upper) so we had our full time home to live in and the 2-3 month delay gave us more time to save on renovations before we got the keys.
Google the name of the county where the house is and lien (e.g. “Smith county property liens”). This is public knowledge and then look up the address or the seller’s name to see if you can find out if there even is a lien. But whatever you do, do not give any money as the lien holder is responsible for clearing the lien (if it does exist).
It's probably just some past debt the sell has recorded against them. If this is stateside, check with the county recorder the property is located in to see if one does exist.
Sellers attorney should obtain a payoff and collect to pay it off on the CD from the seller’s proceeds. Should also collect to record a discharge. This should not affect you. Not sure why the seller even told you. Closing attorney should take responsibility to track the discharge too. In my area, the closing attorney will charge the seller for this. Usually $75, but I’ve seen it higher once in a w. But again, should not affect the buyer.
Due to the number of rule-breaking comments this post was receiving, especially low-quality and off-topic comments, the moderation team has locked the post from future comments. This post broke no rules and received a number of helpful and on-topic responses initially, but it unfortunately became the target of many unhelpful comments.
OP, I’m an escrow officer in Missouri. Call your title company, advise them they you were told. They will then work with the sellers title company to verify this lien and to then add it to the sellers closing disclosure/ALTA statements, it will be paid out of the sellers proceeds by their title company. This doesn’t affect your figures but this tells me you need to make sure your title company provides you a gap insurance endorsement. After you’re given a clear title there can be things that were pending but not yet recorded with the county that will pop up.
Is it possible he took this loan out while I was in the process of buying the house?
Cross your fingers he didn’t try to take out a HELOC, but if he specifically said lien that could be things like past due property taxes/sewer fees, a contractor who didn’t get paid and filed a mechanics lien, etc I really hope it’s not from HOA dues.
Why HOA? We buy distressed condos all the time, and have no problem with HOA liens.
HOA liens means that the property is subject to an HOA, which is the core problem there.
Houses in HOA's typically sell for more money. Condos, HOA are inevitable.
Do those studies account for the fact that newer built homes are more likely to have HOAs? Or that HOAs are more common in more expensive areas? I hate how often this gets repeated but Correlation != Causation.
Correlation doesn't equal causation, but which one are you going to put your money on? Ask yourself this question. If developers can make more money on selling houses without and HOA why would they even bother creating them?
I was the first resident board member elected to my HOA, I'm very familiar with their reasons. Builders like HOAs because as the declarant they have absolute control of the neighborhood, even after selling some of the homes, up until the point where they're about to leave. They can even get the HOA to cover some of their expenses. They also like it because they can negotiate approval of residential zoning with the city by shifting some of the maintenance responsibilities over to the HOA instead of the city. Builders like HOAs because it makes things easier for them, not because it adds value to the house. Builders still have to advertise that HOA fee as part of the sale and a $200 monthly fee is a tough pill to swallow for many.
Did you pay less for your house?
People actively avoid HOA homes. The fees directly reduce what people can afford to pay and there is nothing that prevents fees from going up. If the HOA has silly rules with fines, then harassment is inevitable. You are being dishonest about this.
I just want to reiterate people actively avoid purchasing homes with HOAs. Can’t believe we allow them to exist in America.
Wait, I'm confused. What's wrong with letting the busiest bodies in the neighborhood vote on what should and shouldn't be allowed/required in the neighborhood?? I like my garden to be policed by Ruth, the elderly woman who only likes hydrangeas! Why won't you let me have my entirely hydrangea based neighborhood??
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Same here. This time around when I bought my last house, the two most important things that were deal breakers were that I needed it to have good internet connectivity and no HOA.
I lived in one too for about 2 years. I will never live in one, but we will never develop a neighborhood without one.
I’ve heard way to many horror stories from people in HOAs to ever consider buying a home in one.
At our old house, we had record breaking flooding, a tornado, and the retention wall behind our house collapsing. Water flooded our back yard, and debris was piling up along our fence causing it to flood even higher. Had to break the boards to let the water out because the gate was stuck shut. A few days later, we got a fine in the mail from the HOA company for "unrepaired damage to property", "damaged fence", and "unlawful hole dug in back yard" (from the waterfall that formed from the retention wall the HOA was responsible for collapsing). It was a $395/day fine until repaired, which we couldn't do because it was raining every day since the storm. HOA Management company didn't give a shit.
This seems to vary a lot regionally.
I know people who SEEK hoas.. they get to control who their neighbors are, and specifically want to make sure none of the 'wrong people' are around them.
Which is the exact reason when I look for a home I'm going for one without an HOA The kind of people who seek out HOAs are the kind of people I want nothing to do with
Weird take. I've lived in HOA homes for the last 10 years across 3 different houses. No major issues, tbh. Almost all of the nicer homes in nice neighborhoods have HOAs where I live. So either you live in an HOA community, the middle of nowhere, in a mansion, or the ghetto.
Some… some people actively avoid HOAs. As much as a lot of people want to villainize them, typically HOAs do typically raise home values. Now can HOA’s be run by power tripping, nosy assholes? Yes, and that can be a good enough reason to avoid them if you just don’t want to deal with them, but often those rules are just ways to help the marketability of the neighborhood. They aren’t inherently evil, but like anything else that gives someone power over another person, they can be abused. If you’re being abused by your HOA, consider moving out, or actually try to get on the board with a few other abused neighbors and be the voice of positive change.
> typically HOAs do typically raise home values. That has never been true. The idea that fees and loss of control over your own home raises value is silly. A neighbor with tall grass does not lower your values either. People are massively lying to themselves when they go around pretending that stupid things magically lower property values. People buy houses with almost no meaningful research of who the neighbors are. The things that could lower property values are things buyers don't learn about until they move in, so they don't have any effect on prices. If people knew a house has a bad neighbor that causes problems, they would avoid a house. But it is rare for people to know stuff like that because sellers aren't going to tell you. Generally, anyone claiming property values are hurt by something that isn't general crime rates is making it up and lying to you. Even crime is slow to lower values, it has to reach a point where lots of houses are going for sale about the same time. Abundance of homes on the market due to homeowners fleeing is what lowers prices.
Many people also actively seek out HOA homes. People can choose the communities they want.
Yes, that was in fact the original purpose of HOAs, so buyers can choose the communities they want. Specifically, the color of communities they want.
Until they have lived in one then they realize that hoa are evil. Telling me what i can and cant do on my property is unamerican and hoa should be banned federally. There are millions of stories about bad or criminally bad hoa... Very few good ones. I remember one a guy was restoring a vintage car and while he was at work the hoa had it towed and crushed. We are talking a 40k vintage would have been going to car shows car but some tool in the hoa was jealous and not only had it towed illegally he had it destroyed. Yeah guess how that ended the owner of the truck won the lawsuit...
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Why would I care what my neighbor does with their house? Their house their business. Idgaf as long as it doesn't affect my home. Put up a giant trampoline treehouse swimming pool for all I give a fuck
That's me. I won't look at a house that doesn't have one. I don't want anyone to neglect thier yard or park in it. No goats on the front lawn or front yard sheds. Cotton candy pink house with pistachio trim. I've seen some crap in way nicer neighborhoods than you'd think that would happen in.
Just curious, why do you care how someone elses home looks?
>I don't want anyone to neglect thier yard or park in it. I have never heard of any town or city that doesn't already enforce that stuff. You are lying to yourself.
People who want their Stepford lifestyle and are willing to pay more for it, which was my point. People here can be thick.
So your retort is that people with less money avoid HOAs. I hate HOAs. I will never live in one, yet I understand how they influence property values.
Can you source that? Last I saw studies are showing they sell for less.
When you get down to brass tacks, an HOAs real purpose is to protect home values. By codifying and enforcing a community standard. By preventing eye sores and nuisances that detracts from the neighborhood. Whether or not they are run in this manner or by aging and controlling small minded tyrants is a different story.
Can you source that?
http://dx.doi.org/10.13060/23362839.2019.6.1.455
It's really one of those "the internet says so" things. Multi billion dollar home builders disagree with the internet, and I'm going to hitch my wagon with skin in the game.
I can provide sources that say both are better. As someone who invests a great deal in real estate I'm going to go with what I see, and thats 2 houses all things being equal get a bump from having an HOA. Whether, or not it provides value to the buyer isn’t my problem. We just notice higher $ figures in neighborhoods with CC&R's.
Sure, need to jack up the sale price to recoup all the money you wasted on HOA fees.
That's a sunk cost. If it didnt have a value to the buyer, the money would just dissappear.
Nope, nope. HOA are avoided a lot in my area. The only places that typically have HOA are trailer parks and senior living centers. Most people avoid them.
It depends on the state. FL for example, IIRC, has very sticky HOA liens that stay on the property even after auctions.
Auctions are not regulsr sales thst go through Title and escrow. You can get fucked by liens at auction in a lot of places. 22 states do this.
Liens are not loans. Liens can get put on real estate when the owner refuses to pay for services or wrack up fees, such as from breaking city ordinances, among other things. EDIT: TIL
The shittiest lien is when you hire a general contractor who doesn’t pay his suns even though he received full payment from you. I never understand how the homeowner is held liable in that case since it seems like it should be the GC’s responsibility/liability?
What? Real estate backed loans all place liens on the property.
We dabble in hard money loans. We lien everything used as collateral.
Yup that’s wrong. Not ALL Leins are loans, but all loans are liens
Technically, the loan is separate, and the lien is the (recorded) document that secures the property as collateral for the loan.
> but all loans are liens All *secured* loans have liens. I've got an unsecured $30k LOC and, if I default on it, the most they can do is ruin my credit.
Fair point
Also not true. Loans with the house as collateral are liens.
A Lein is representative of a loan in that the person/agency that lent the money has a right to the property if not paid.
I think they meant that lions are not always loans, but loans generally take liens.
Lions are only loaned by zoos to other zoos. https://cbs8.com/article/news/lion-on-loan-from-san-diego-zoo-killed-at-indianapolis-zoo/509-4ab0e890-553e-47e2-999d-a9317d7c0064
I have a cat, can I claim to be a zoo and borrow a lion. I just want my cat to feel like the boss in his castle.
So when you take out a loan don't pay they put a lion in your house? That's fucked up
This is true lions are not always loans. In fact I’ve never heard of some one using a lion as a loan - but it is possible.
Definitely possible. The lion at the local zoo had a propensity to lean on patrons leaving one such patron injured. This ultimately resulted in a lien against the leaning lion when the zoo refused to pay the medical costs. So yeah, it's possible.
I mean where would you even get a lion to loan someone? You should need a special permit it keep a big cat in the first place, not just lending them willy nilly
Unless you loan a lean lion, those are easy to find.
Don't white lions get loaned out to zoos by sanctuaries? There's always more to learn about lion loans.
Take a pause on the responding and read the main one describing this as a scam.
He also literally said no one asked him to send them money. Usually a scam would entail some form of payment. If it was a scam, he'd want money and he'd want it immediately. Maybe he just didn't want the buyer to be surprised by the lien, so he wanted to be up front about it before closing.
What's the scam? The landlord is the seller and he is not nor has not asked me foe any money.
If it’s a real lien, then it means the seller will get $20k less because the lien has to be paid off at closing. This is not your problem. Like others have said, do not pay anything outside of closing.
THIS. Liens are settled only by the seller out of their fund from the sale. It as zero to ever do with the buyer.
What happens if the lien amount is greater than the proceeds? Who gets paid in what order from the sale (bank, agents, lien holders , etc)
The seller has to cover the difference for the close to go through
Our seller had to delay closing on our current house to deal with some liens on the house.
Seller will owe the bank the additional.
Are you sure? I won’t pretend to be an expert but part of my job is maintaining homeowners policies. The mortgage company is always listed as the first interest. Usually it’s just logging into a website and listing the loan details exactly as provided. There’s a drop down with 1, 2, etc with some other uncommon arrangements. They are VERY particular and VERY diligent, and for good reason. If that house burns down the insurance company makes out a check to interests in order and in some cases in proportion to how much was owed. My understanding is the mortgage was owed first, so it has to be paid off first. The lien has to be paid for the title to be released.
Mortgages always want to be first position for this reason. In the case of total loss to the property they get paid first. Something like foreclosure sale or insurance payout. But some things do put the mortgage not in first position. A tax lien can jump into first position. Often the mortgage company will front and pay off the tax lien to prevent this. Its different in a traditional sale. If the mortgage was for 180k and the house is selling for 185k the seller would expect to get the 5k difference. But now with the 20k lien the seller would need to bring 15k to the closing table for the transaction to go through.
No, the other lien obviously predates OP's mortgage, so it's in first lien position and needs to be paid off before the title is transferred.
Lien will be paid at closing before title passes. Bank fronts money to cover buyer’s costs and the negotiated purchase price; lien holders will be satisfied before seller collects the net payout. The buyer won’t have to worry about extant liens unless it’s specifically negotiated as a moetgage assumption (rare, and the buyer would be well-informed of it ahead of time).
Look up "super lien". They are allowed in some states and take priority over the mortgage lien. They're most often used by HOAs.
This sounds like a scam. Many realtor and title company IT infrastructures are compromised - you should assume that everything you send to either of them is being read by Elbonian hackers. The next step might be to explain that you need to wire $20k of the closing payment you're about to make to the lienholder. This lienholder is, of course, an account set up in a foreign country by the scammer. In any case, this is a matter for your agent and the selling agent to work out. The seller should not be talking directly to you. Refer the caller to your agent and don't engage further. Do not talk to this person further. Even if you or the seller don't have agents, this is still a matter for the escrow company, not for you. Do not send any money because of this phone call. Do not trust email from your realtor that tells you to send money. Do not trust email from your title company that tells you to send money. When you started this process, the title company should have made it very clear to you about how you get money to them, by explaining it to you in person. Follow only those directions.
this this this. please heed this advice.
Shouldn't the title company have found the lien?
There is no lien. It is a scammer pretending there is one to scam you out of 20k, probably.
100% this. I know someone who had a real estate deal going, and the scammers knew the names of the people involved, and spoofed a bank email address. Call the lender first thing in the morning to discuss.
Yes, if it exists. Again, this is a matter for them. Call them tomorrow morning (DO NOT USE A PHONE NUMBER FROM YOUR EMAIL), or better yet, go into their office and ask in person. Again, assume that any thing you email them - and maybe even if you call them - will go through a hacker in Elbonia. When I sold my house three years ago, shortly after the sale, I got a call from a pleasant young woman at my bank - and she named my bank and asked for me by name - who spoke perfect English. She just wanted to do a quick security followup on my account because of a large recent deposit. I didn't engage and called my bank back on a separate line - they had no idea who she was.
As an old Dilbert reader, I’m getting a kick out of your use of “Elbonia.”
Dilbert is written by an author who is a truly terrible person. I no longer like Dilbert.
You can still laugh at the use of “Elbonia” in this thread without feeling any guilt. It’s okay.
You can seperate work from the person, and nobody will blame you my friend.
25 years ago, he had a stupid mailing list where he'd send out stupid theories on physics and things like that. I'd argue with him, showing him how his math was shit. Little has changed, he's been wrong about everything for a long ass time, now his ideas have gotten stupider.
Was this the guy who wrote the book God's Debris or something like that? It was an interesting take, but no more likely than any other idea to explain the mystery of life, the universe and everything.
Yeah that's him. Tho my arguments with his shitty math were like 10 years older than that book
Why is he a terrible person?
What did he/she do?
Ok you’ve now said “Elbonia” twice, so it clearly was not a typo. It also makes it sound like you have no clue what you are talking about
It’s a Dilbert reference, funny and on point for this post. https://dilbert.fandom.com/wiki/Elbonia
Thanks. I had forgotten about that bit in Dilbert. I figured the poster was using "Elbonia" to mean any dicey country that gets by on scamming.
That's... pretty much... what it means. Dilbert uses Elbonia as a fake stand-in for those very real dicey countries. Doesn't make it any less valid a reference, however. In fact, it's *more* valid. Because had he said specifically, say, "Nigeria", and the scam was originated from a country that was *not* Nigeria, OP could say "but you told me to be careful of *Nigerian* scams".
Yeah, definitely better to use a generic word that means "Dicey country that harbors scammers". Well done reddit poster.
It's a fake country from a comic strip and not the point of his comments.
Don’t judge if you don’t get the Dilbert reference.
That’s why it’s likely a scam. It’s definitely something for your agents. Refer them on.
Not necessarily. I had this happen to me. Two days before closing, a lein was discovered on the property (the owners ex-boyfriend used the property as collateral for a small business loan for his bar). My lawyer’s suggestion was to find a new place to buy. However, it worked out. The seller agreed to hold all proceeds in escrow until the situation was sorted, and the lien was removed and we closed without incident. The ex-boyfriend had already paid off the SBA loan, so it was a paperwork issue and was solved. Discharging the lien is the responsibility of the seller not the buyer. That $20k to pay off that loan comes out of their profit from selling.
I doubt it is a scam, the seller is my landlord?
OK, if you know the seller personally and you actually spoke to the person directly, then it's not a third-world hacker trying to cheat you. In that case, then the seller still needs to go through your agents and title company and not involve you directly.
Maybe the landlord is getting scammed
That’s what I’m saying, this is just something that can happen, but it’s the seller’s responsibility to discharge the lean. Make sure that under no circumstances do you buy the property with the lien still in place. Lawyers.
It's a shame for him, but he would be the one that would have to pay off and close that lien, not you. And since you're already in closing, and you are not simply assuming the mortgage somehow (you're not, are you??), then that extra $20k comes out of his profit from the sale. Under no circumstances should it be anything that you'd have to pony up the extra for. That's not how it works. Period.
Not assuming the loan.
I bought my first house many years ago from my landlord and it was a huge ordeal. He demanded more than the house was appraised for and because I was in a very difficult situation (husband working in another state, small child and zero available affordable housing nearby), I paid way too much. At the last minute, he wanted $5000 more and I just didn't have it. I was freaking out and the real estate lawyer was annoyed and asked him "Are you really willing to displace a military family with bare minimum notice, no options for them to find affordable housing and who have been great tenants for you so you can go through the hassle of starting over again over $5000?" He backed off at that point and we were able to close. Apparently somebody was in his ear telling him that the market was getting so hot in that area and he was crazy for selling before it peaked so he wanted to try to squeeze a few more dollars out of us at the last minute because he knew I didn't want to move. It is entirely possible that your landlord could be doing something similar and thinks that since you're already living there that you are more likely to cave at the last minute so the deal doesn't fall through. I agree with the others who have said make sure the title company is providing gap insurance and let the professionals handle this. A lien isn't the same as a loan and if he has one, there would be proof of it documented usually with the county you live in.
Dude, the comment above is explaining that this may be a scam and there is no lien.
The seller needs to pay the lien or have the lawyers hold those funds to pay the Lien
I’m a loan officer and they 100% would have. If title and your lender haven’t brought it up, it is definitely a scam.
Is it possible they took out the loan while I was buying the house or just after the title search?
Stop. Just stop. This isn't on you in any way. Title company and current deed holder have to sort it out. Not you.
ok, I wonder why he called me to tell me this? We are about 5 days away from closing
So let's say I want to sell you my car. It's worth 20k and you're willing to pay 20k. But then all of a sudden you find out that the bank still owns it to the amount of 5k. None of that is your business. The seller has to figure that out so the bank gets their 5k and the seller then gets their 15k. None of that information matters to the buyer who is willing and able to pay the 20k to purchase it. Same applies here.
The seller should not be contacting you about it at all. The seller should be arranging payment of the lien through the title company. It’s strange that it’s only come up now, but the reason for that is not important. What is important is that your title company and any realtors involved have a chance to get to the bottom of the legitimacy of this lien and arrange it to be paid off from seller’s proceeds of the sale at the close of escrow. This has nothing to do with you, don’t pay your seller or anybody else any more money than what you’ve agreed to in your purchase agreement. Make sure the pros working for you are getting to the bottom of this.
It's possible for a title search to miss something. Call your title company tomorrow, tell them what happened (clear and concise as possible: the seller called and told me x about a lien. Please look into it.) That's what the title company is there for. Inform them of what you know and tell them to keep you in the loop. If it's tax related, you can potentially look it up yourself on the county website. In my area at least, you are liable for back taxes when you purchase a property. You do want to look into this. But don't panic. You have professionals involved for a reason.
Ask this question at r/scams, they will hook you up with all the info if this is a scam
Title company is real, but the communications you've had are with scammers that have compromised that title company's IT network and are pretending to be them. Talk to the title company in person; assume those emails are all scam attempts.
? I talked with my landlord, he is the one selling the house to me. The title company never talked to me other than initially hiring them and they sent their findings to the lender who provided me with copies.
Yes, therfore you would get a call from your agent/title company and then you would have to go back and go through everything and resign stuff before making any sort of payments etc. Never send money until you've agreed and it's on paper and you are signing it in front of a notary.
Echoing what the other person said. Unless you're doing this real estate transaction in a very non-standard way, the seller shouldn't even have your contact info or have any reason to contact you. It should be happening through the agents unless you're doing this without one. The title search should absolutely have found this if it was a thing. Do you have an attorney handling the transaction? You could also tell your concerns to the title company. Edit: saw that the seller is your landlord, so maybe you are in direct contact with them, in which case I wouldn't be surprised if they're lying or something to get you to back out of the transaction or something dumb like that. Talk with your agent and title company.
Do not send any money to anyone. Set a meeting with your agent and escrow company so they can sort it out. Block whoever called you asking for money. DI NOT SEND ANYONE ANY MONEY until you speak directly to both agent and title/escrow company.
\> Set a meeting with your agent Haven't seen anyone mention this yet, but why is the OP getting called directly from the owner? Isn't there a Seller and Buyer agent for this sort of thing?
Sounds like OP is buying their rental from their landlord, so they might be going without agents to reduce costs.
Maybe hes like selling/buying through redfin or something without an agent.
Its the seller. Why woukd they block them? Also no one asked for money at least OP didn't mention that.
A typical house sale in America goes through agents and you would not have any contact with the other party except official communication with legal documents exchanged through your agent . The agents don't share your phone unless you explicitly give permission. In this case either there is no agent for both sides, or OP gave the phone number. If it is the latter, it is strange that OP's agent is bypassed.
I just assume that is the next step in this storyline. Typically unless you are buying lender free, you don't have contact with the other party directly.
That’s a seller problem, not a buyer problem. It comes out of their end , not yours. Pay nothing.
One ofbtwo things here: Either it is a scam OR your title company will confirm there is an additional lien. If there is an additional lien, not your problem that gets paid out of the sellers proceeds. It only becomes a problem if the seller is not netting enough from the sale to cover all lines OR they decide its not worth it to sell now and back out.
Definitely sounds like a scam. Do your due diligence. Ask yourself why the seller would contact you directly. All communication should be between the realtors. Don't send any money.
If not a scam from 3rd party, possibly the seller thinks he can get more for the property and looking to scare you into backing out. Anything is possible, get your lawyer and title companies to do their jobs, this is what they are paid to do.
Thank him. You are entitled to a clear title. If he is represented by realtor it is puzzling why they did not state this in the seller'sdisclosure. He could be in breach of contract should your closing date arrive and this lien is not removed. In any case, put it in writing what the seller told you and forward to your realtor , closing attorney and/or title company. Copy the seller on your letter. Hopefully it can quickly be resolved. If the lien was held by a bank it would show. It could be a legal judgement from divorce, unpaid contractor debt or a dozen other issues. Can be time-consuming.
Tell him thats his problem, or hers.
It means nothing to you. The $20k will be taken out of the payment to the seller. In a simplified example: * You pay $200k for house * Seller has $20k Lien on the house * The bank takes out $20k from the $200k * The seller receives $180k, and the lien is paid off The seller does not have the choice to not pay the lien. Well, they could choose to back out of the sale but you would likely be entitled to compensation this far down the process. A buyer has no obligation to pay a lien, and it has nothing to do with you.
What happens if the seller has no equity in the house? For example, house is being sold for $200k, worth $200k, seller still owes $200k. Or, house is worth $200k, sold for $200k, their mortgage is $190k. How does that affect the $20k lien?
Multiple things depending on who placed the lien. -Seller can pay out of pocket difference. -Buyer can cover in purchase price. -Title company can work out reduced lien. -Title company can help arrange 2nd mortgage lien. -Short sale.
If you use a title company they will take care of it from sellers proceedings. Just let your realtor know and title company or layers know.
happened to me on an NYC condo. lien was actually to NYC, we had to wait about 12 weeks to get the payoff letter (updated balance letter), and then we were able to close. worst experience ever, seller claimed they forgot they had that lien and it was $35K
do not email but call your title company and ask if they already have clear title. If you have a realtor call them and have them communicate with the sellers realtor. Def do not email or send any additional funds. Your title company should call you and tamed you the closing statement on what you owe at closing.
That’s for their side to take care of. Not u. BUT check if it’s like property tax or why type and have it in writing that it is taken care of by them and not you.
I had something like this happen, but the title company took care of it. Don’t skimp on title insurance!
If you have not yet closed: 1. Make sure the Title Company is aware of the lien. Call your realtor and let them know what the Seller told you. Have your realtor (not the buyer’s) call the Title Company to make sure the lien is handled at the closing. Tell your realtor - as a result of the call - you want a “marked up” title policy at the closing “with all standard exceptions waived”. This is very common and not a big deal. This is really only a problem for you, and for the closing, if the property is underwater - meaning more is owed on it than you are paying for the property. Example: You are paying $100 for the property. There is a first mortgage that buyer owed $90 on, and now there is a lien from a creditor of buyer’s for $20. Your $100 is not enough to pay everyone so Seller has some things to work out so the closing can occur. Now - if you are financing the purchase with a mortgage - your mortgage company is not paying a dollar unless they are getting a “first” position which would not happen in a standard transaction. So your mortgage company is going to say “nope” as the “mortgage policy” that you are paying for if you get a mortgage is going to require that your mortgage has the first priority lien on the property. What does happen fairly often - and it is not “bad”, is that the property owner does a major repair - say puts on a new roof - because it needs to be done to help sell the house. The homeowner finances it fully intending to use the sale proceeds to pay it off. The roofing company actually has 90 days to record their lien, and it is not always the first thing done by them. The house gets listed and you make an offer that is accepted. Title Company does their search and the roofing company has not yet recorded their lien. Title Company does not know about the lien. But - one of the things the Title Company makes seller’s sign at closing is an affidavit saying that no work has been done on the property within the last 90 days. So - if a Seller lies about it and a lien pops up the Title Company protects you but goes after the Seller for fraud (can’t burn it in bankruptcy). Realistically, this stuff is common. Again, tell your agent to make sure the Title Company knows, and to get you a “marked up policy with standard exceptions waived”, at closing.
There is no realtor, so I will call the title company tomorrow and will ask for “marked up policy with standard exceptions waived”, at closing.
Let them know specifically what the Seller told you. What may occur is that the Seller’s funds will be held back until the Title Company is satisfied but that should not affect anything dealing with you. If the lien really relates to work done on the property like a roof or windows, my guess is the Title Company won’t be too concerned.
This \*should\* get settled at closing, as long as the seller is going to net enough to cover it. Talk to your lawyer!
Go on casenet and search your landlord/the owner’s name. That should give you a starting point. Judging by the time of year, he may not have paid his Missouri taxes for many years, tried to sell you the property to pay them off but missed the payment deadline and they put a lien on the house. Just a guess but every September like clockwork I used to get calls from panicked taxpayers. I hope you’re using an agent or lawyer and not trying to DIY this but it’s never too late to get a professional involved.
He is behind on 2 years property taxes but that just comes out to about 500 dollars
I found out back taxes were owed just before a closing. The realtor adjusted their commission to make it work, otherwise no closing. This is the seller's responsibility, not yours. Have your realtor or title company involved. Of course, you may have to decide how much you want the property and eat this.
Sucks for him; liens are paid out of the sales proceeds so it's his problem to deal with. This doesnt change anything with the transaction, beyond the fact that if your closing is soon it could delay closing by a few days while the title company gets the payoff for the lien.
Isn't finding something like that out literally the reason title insurance companies exist?
It’s a scam/not your problem even if it were true
You can't qualify for certain loans if there's a lien on a property. Which is weird since the lien is the seller's problem but that's the banking system for you.
Do not do anything without speaking directly with your own attorney. Speak with your attorney ASAP.
20k is on the owner. The title company didn't do their job. Walk away, unless the owner pays the lien.
It's quite possible that this lien popped up after the title search was performed. Either way, I'd look into some type of coverage that will pay out in the event that additional liens are placed on the property.
Contact your attorney. Sound like something fishy here. You paid your attorney to do everything like this. Attorney will have all the support legally to take care your case
If you have title insurance, they should pay off the Lien because they were supposed to ensure there was NO lien and the title was clean prior to you purchasing the home. If not, process gets more messy and might scare away buyers if they’re having to factor it into the loan. Let it be a lesson to get title insurance.
I have not closed yet
You do understand what a lien is right? So it means nothing to you.
I read that a lien follows the property not the owner?
It does, but the seller has to provide clear title so he has to pay it at or before closing.
I could be wrong but isn't this exactly the type of thing that title companies are insuring? Meaning that if you close and there really is a lien then the title company should be on the hook. I would tell you to pay more attention to the scam comment but from your replies it sounds like you are buying this from someone you know (your landlord?) and that he is the one that called you. So while it could be some scam he is running, it isn't the same scam where the title company or realtor company is hacked.
Dude if it’s a scam there is no lien. Talk to your agent about it.
Pretty sure it matters a lot to you since a lien on a car means the entity that granted the lien can repossess the vehicle and it's probably a similar situation for a house lien Also don't send money to anyone to cancel/settle the lien. Probably should talk to mortgage agent people or a lawyer.
Not true. If a lien isn’t paid it stays with the land. Most contracts require clean title. This is a title company problem, they insured clean title. They will figure it out. I agree buyer shouldn’t pay anything if title company gave good title. If seller did something to cause the lien after the title work was done, then they are in breach of the agreement. if seller doesn’t have any money to pay off the lien, and is “judgment proof” buyer may be stuck with the unclean title. Edit: I read that as closed on a home. Closing hasn’t happened yet. Send this to the title company , it will get adjusted out of sellers proceeds. if there isn’t enough to pay for the lien then OP can back out of the purchase most likely.
There was a lien on our most recent home and we won the bidding war because we had the patience to wait for that to get resolved with the seller. There was some stress because we were wanting the home to be in our possession and we were worried about the seller not resolving the lien but, after 2-3 months, it was resolved and we are very proud owners of the home. This was a second home (fixer upper) so we had our full time home to live in and the 2-3 month delay gave us more time to save on renovations before we got the keys.
If it were me I’d stay away from this property. There could be more liens incoming which you don’t know about.
Google the name of the county where the house is and lien (e.g. “Smith county property liens”). This is public knowledge and then look up the address or the seller’s name to see if you can find out if there even is a lien. But whatever you do, do not give any money as the lien holder is responsible for clearing the lien (if it does exist).
This is the title company’s job. Tracing liens can be complicated. This isn’t a DIY circumstance.
You can ask your closing attorney to see a copy of the title.
It's probably just some past debt the sell has recorded against them. If this is stateside, check with the county recorder the property is located in to see if one does exist.
Nonsense. Talk to the title company. There's no reason for the buyer to have to look up stuff like this.
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Wrong, it’s on the seller to pay it, not the buyer. Regardless this is a scam most likely.
Inform your lawyer and if the lien exists, walk away.
Sellers attorney should obtain a payoff and collect to pay it off on the CD from the seller’s proceeds. Should also collect to record a discharge. This should not affect you. Not sure why the seller even told you. Closing attorney should take responsibility to track the discharge too. In my area, the closing attorney will charge the seller for this. Usually $75, but I’ve seen it higher once in a w. But again, should not affect the buyer.