Buying a house with Lis Pendens filed. NOT a short sale. Risks involved?
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I wonder how the original poster did on this. It was some time ago.
I see two people seem to have tagged on. Let me just throw something out generally fyi from what a friend and I were reminiscing about re lis pendens. Yeah, lis pendens reminisching. I don't know what was going on with that hoa issue here but they don't always have to be such red flags. Can be slower because there are more steps and anyone can mess things up and put a stop to an otherwise reasonable situation.
Lis pendens is Latin for "suit pending". One would think not a good thing. I had only experienced it regarding a friend divorcing a few years ago. A passionate divorce can be very different than a situation with a calm, cool, reasonable bank. If that bank is calm, cool and reasonable. When a divorcing warring couple has several properties a spouse may file a Lis Pendens so that the land records show there is a suit pending....and what buyer wants to try to get mixed up in that. The purpose of this particular lis pendens in my friends' case was so that the properties could essentially not be sold because neither side was going to let go of the lis pendens. In such a situation, it is understood that couple needs to figure things out for quite some time before those properties are freed up for purchase or will be lived in by one or the other spouse or vacationed in and kept by one, rentals, sold, etc.etc.etc.
A lis pendens on a property, is a notice that some money is owed to someone. It is just like a mortgage, or other debt and often like in this case the lis pendens was filed by a lender, already holding the mortgage. A lis pendens is really just a notice someone is going to start exerting their rights such as foreclose a mortgage.
The title insurance company and escrow company (often both the same) will make sure that the title is clear and any lis pendens is removed prior to disbursing funds and filing the deed along with any new mortgage, etc.
A lis pendens sounds scary but it is not. That is why you always want to get title insurance, and place any funds you give them in escrow, not given to the seller, etc. It will be removed at time of closing or before.
A lis pendens on a property, is a notice that some money is owed to someone. It is just like a mortgage, or other debt and often like in this case the lis pendens was filed by a lender, already holding the mortgage. A lis pendens is really just a notice someone is going to start exerting their rights such as foreclose a mortgage.
No, that is incorrect. A lis pendens is a notice that a lawsuit has been filed which affects that particular property. It is not just like a mortgage, because it is not a lien on the property. A lis pendens (from Latin) is simply notice of a pending lawsuit. A lis pendens gives notice to a prospective purchaser that if they buy the property, their purchase may not be secure since prior rights may be established when the lawsuit is settled. Therefore, if they buy the property, they could lose title to another party...and then they would need to seek damages from the Seller--which could be a difficult thing to do.
The reason mortgages are often associated with a lis pendens is because the banks need to file in court to foreclose on the mortgage. There can be many other reasons why a lis pendens is filed.
In general, a Lis Pendens is the first step in the foreclosure process. I have seen it take more than a year to actually get to foreclosure after filing.
Or one of many steps in a lengthy angry divorce settlement where the purpose is to not have a completely paid up property sold in any way. It is to keep the property and not let the other side sell it...sometimes out of fairness, sometimes in order to be a better rat.
It is significant to find out the reason for the lis pendens, for one thing.
Or one of many steps in a lengthy angry divorce settlement where the purpose is to not have a completely paid up property sold in any way. It is to keep the property and not let the other side sell it...sometimes out of fairness, sometimes in order to be a better rat.
It is significant to find out the reason for the lis pendens, for one thing.
And it's important to note that a lis pendens does not legally prevent a property from being sold...but a purchaser could be subject to some nasty consequences if they chose to purchase it while a lawsuit was pending.
(So, in nearly all cases, a lis pendens effectively blocks a sale.)
And it's important to note that a lis pendens does not legally prevent a property from being sold...but a purchaser could be subject to some nasty consequences if they chose to purchase it while a lawsuit was pending.
(So, in nearly all cases, a lis pendens effectively blocks a sale.)
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