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I have a situation with a friend of mine. His home/house was gifted to him by his sisters Power of Atty over his mother. The title re-issued by the clerks office for the county shows no liens. We went to the clerks office and copied all deeds of record from the date the home was built. So the previous one shows no lien either. So here is the fun part. There is a $60k HELOC against the home and original owner (Mother). The sister who has full PoA stopped making payments to the bank. (she is/was trying to send the home into forclosure, even though funds were/are available for payment - SSI & Retirement monthly checks). So who is responsible for payment of this loan since he got has a physical title that shows no recorded lien?
Here is some background to think about before you respond:
The sister will not release any documents to the brother and has instructed all institutions not to release any to him either.
Just in case you ask why was the house gifted, the Mother is under Medicaid and is in a Medicaid facility. The gifted was allowed due to the Medicaid Two Year Rule. He moved in/lived in Mothers home to take care of her for over two years. Thus under this rule the home can be gifted to him and Medicaid cannot sell the home to cover expenses. Except for the monthly checks the Mother has no assets.
Any assets that were available in the home was taken by the sister the day before (she had keys due to PoA) the home was gifted while the brother was at work. She took all jewelry, small antiques, pictures, etc....
The sister has not lived in the home for over 20 years and has her own house.
Can't. The Sister as PoA can take whatever property she wanted as long as it was not the property of her brother. She would have taken the furniture if she had a place to store it or sell it quick. Once the deed was signed over then the house and all its contents (legally abandoned) belongs to the brother. She was arrested a few months back for assaulting her brother, but the county atty would not prosecute her.
Quote:
Hopefully, in addition to posting this here, you have an appointment scheduled with a lawyer.
Well I'd like to hear from the on-line scholars and read their perspective in the bolded question: Who is responsible for payment of this loan since he has a physical title that shows no recorded lien?
Maybe it should be treated like a home sale, can the bank record a lean after the house was sold since they forgot to under the old owners?
Some states are pure recordation states and some states are equity states. In equity states only a bona fide purchaser for value takes over the lender with an unrecorded mortgage. In pure title states the lender who fails to record loses his lien. Did I miss the part about where the property is located?
I'm sure glad I don't practice in Va. Their cases are all a big mess. But I'm 98% sure you lose and the credit line attaches to your interest in the property. Your lawyer will tell you for sure. What he won't tell you is that if you go out and mortgage the property (don't lie on the application) and take the money and put it in your pocket, then as between the old HE lender and your new lender, the new lender wins and as between you and the old HE lender, you don't owe them any money.
You're welcome, donate $500 to your local SPCA. No legal advice intended. Consult an attorney licensed to practice in Va.
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