Posted on: 18th Jan, 2008 11:01 am
First off, thanks to all of the people answering questions. I have been reading the forums for the last couple of hours and have already learned quite a bit.
I hope I can explain this situation clearly enough.....
There are three parties involved here.
1)Mortgage Holder. These people are friends of ours. We trust them.
2)Title Holder. People we do not know
3)Us
We are in New York state
Party number two has basically defaulted on the mortgage. They just want to get out from under the mortgage and are willing to sign the title over to us.
The people who are holding the mortgage are on board too. they will let us take over payments or buy the property outright.
We have had a Title Search done and it seems there are some leans and judgments against the home other than the mortgage.
What is the best way to take ownership of the property without being responsible for any of the other liens and judgments? The people holding the mortgage are up for pretty much anything, they just want us to have the property.
Will a quitclaim do the trick?
TIA for any advice!
I hope I can explain this situation clearly enough.....
There are three parties involved here.
1)Mortgage Holder. These people are friends of ours. We trust them.
2)Title Holder. People we do not know
3)Us
We are in New York state
Party number two has basically defaulted on the mortgage. They just want to get out from under the mortgage and are willing to sign the title over to us.
The people who are holding the mortgage are on board too. they will let us take over payments or buy the property outright.
We have had a Title Search done and it seems there are some leans and judgments against the home other than the mortgage.
What is the best way to take ownership of the property without being responsible for any of the other liens and judgments? The people holding the mortgage are up for pretty much anything, they just want us to have the property.
Will a quitclaim do the trick?
TIA for any advice!
hello riko,
welcome to the forum.
as the lien is attached to the property, as soon as there is a change in ownership, the new owner will be responsible to pay that off. even with a quit claim deed, you shall remain liable to pay them as the ownership rights will be transferred to you.
it will be better if you negotiate with the present owners to pay off those liens so that you may get a clear title.
it is nice to hear that the forums have helped you to learn quite a bit.
feel free to ask the community if you have any further query.
welcome to the forum.
as the lien is attached to the property, as soon as there is a change in ownership, the new owner will be responsible to pay that off. even with a quit claim deed, you shall remain liable to pay them as the ownership rights will be transferred to you.
it will be better if you negotiate with the present owners to pay off those liens so that you may get a clear title.
it is nice to hear that the forums have helped you to learn quite a bit.
feel free to ask the community if you have any further query.
jenkin thanks for answer!
Unfortunately the current title holders can not take care of the liens at all.
The mortgage holder is willing to hold the mortgage as a layer of protection though, since they are first lien holder.
I know this is probably out of the scope of this forum and probably can't be answered without knowing what types of liens and judgments there are, but do you think a bankruptcy for the title holders would clear up the title?
Unfortunately the current title holders can not take care of the liens at all.
The mortgage holder is willing to hold the mortgage as a layer of protection though, since they are first lien holder.
I know this is probably out of the scope of this forum and probably can't be answered without knowing what types of liens and judgments there are, but do you think a bankruptcy for the title holders would clear up the title?
hi riko,
welcome back.
your query isn't beyond the scope of our forums at all. we are a mortgage community no doubt but we try and provide financial advice in mortgage, credit, personal finance and related issues. so, it's ok to discuss this issue with us. :)
as for the query, bankruptcy won't help to clear the title. it can help you get rid of debts but first let me know what are the liens or judgments due to? only then can i come up with a concrete solution.
however, considering the situation here, even if the current owners pay off the liens, the mortgage remains. i mean, a quitclaim won't help the owners get out of their loan. so, either they'll have to do a novation - transfer the loan to you directly with the lender's approval. or else, you will have to refinance the loan in your name simultaneously with the quitclaim transfer.
good luck and for further queries, please don't hesitate to ask. :)
welcome back.
your query isn't beyond the scope of our forums at all. we are a mortgage community no doubt but we try and provide financial advice in mortgage, credit, personal finance and related issues. so, it's ok to discuss this issue with us. :)
as for the query, bankruptcy won't help to clear the title. it can help you get rid of debts but first let me know what are the liens or judgments due to? only then can i come up with a concrete solution.
however, considering the situation here, even if the current owners pay off the liens, the mortgage remains. i mean, a quitclaim won't help the owners get out of their loan. so, either they'll have to do a novation - transfer the loan to you directly with the lender's approval. or else, you will have to refinance the loan in your name simultaneously with the quitclaim transfer.
good luck and for further queries, please don't hesitate to ask. :)
Thank you for your reply, Caron.
I honestly do not know what the liens and judgments are at this point. Our lawyer did a Title Search and said there were a few other of those items on the title.
The mortgage I am not worried about at all. We are going to take care of that with the mortgage holders as soon as the current title holders are out of the picture. They are more than willing to allow us to just pay cash for the remainder of the current mortgage. Which is our plan.
I am just worried about all the liens and judgments the current title holders have.
For example, I get the title signed over to me, I pay off the mortgage and move into the house.. 6 months from now a creditor says I owe them $10,000 and they are going to take the house if I don't pay. Again I am not worried about the mortgage, but the other liens the current title holders have that would allow this to happen.
If the quitclaim transfers the title, and the novation transfers the mortgage, that would be perfect.
Now I just need to find a way to protect myself from the other liens! :)
The current mortgage holders are willing to hold the mortgage until the other liens expire.
I know the judgments expire within 10 years, and I know some of them have already been in place for a few years(according to our lawyer), so as first lien holder, will them holding onto the mortgage give me a layer of protection?
Thanks for helping me sort this all out!
I honestly do not know what the liens and judgments are at this point. Our lawyer did a Title Search and said there were a few other of those items on the title.
The mortgage I am not worried about at all. We are going to take care of that with the mortgage holders as soon as the current title holders are out of the picture. They are more than willing to allow us to just pay cash for the remainder of the current mortgage. Which is our plan.
I am just worried about all the liens and judgments the current title holders have.
For example, I get the title signed over to me, I pay off the mortgage and move into the house.. 6 months from now a creditor says I owe them $10,000 and they are going to take the house if I don't pay. Again I am not worried about the mortgage, but the other liens the current title holders have that would allow this to happen.
If the quitclaim transfers the title, and the novation transfers the mortgage, that would be perfect.
Now I just need to find a way to protect myself from the other liens! :)
The current mortgage holders are willing to hold the mortgage until the other liens expire.
I know the judgments expire within 10 years, and I know some of them have already been in place for a few years(according to our lawyer), so as first lien holder, will them holding onto the mortgage give me a layer of protection?
Thanks for helping me sort this all out!
Hi Riko,
Welcome back.
Your concerns are obvious. But again, there aren't any ways out there to get rid of judgments and liens until and unless the debtor pays them off.
Even if the mortgage holders are ok with the liens and will hold the loan till the other liens expire, it may happen that the creditors may sell off the debts to a collection agency. And then who knows you might get threatening calls instead of the original debtor! So, it's better that you have a talk with the current owner and ask him to sign an agreement that he'll pay off the liens while you take over the property. Take help from an attorney on this issue. to pay them off.
In case the current owner doens't want to pay, well then try to contact the creditors (ask the current owner) and then negotiate with them so that you can pay them and protect the home from further liens. I don't like the idea of your paying for the original debtor but there's no way out if he doesn't listen. At least it's better than getting calls from collection agencies and facing their harrassments instead of the original debtor undergoing these things.
This may not be a very good financial solution but certainly a way to get out of this mess. :)
good luck
Welcome back.
Your concerns are obvious. But again, there aren't any ways out there to get rid of judgments and liens until and unless the debtor pays them off.
Even if the mortgage holders are ok with the liens and will hold the loan till the other liens expire, it may happen that the creditors may sell off the debts to a collection agency. And then who knows you might get threatening calls instead of the original debtor! So, it's better that you have a talk with the current owner and ask him to sign an agreement that he'll pay off the liens while you take over the property. Take help from an attorney on this issue. to pay them off.
In case the current owner doens't want to pay, well then try to contact the creditors (ask the current owner) and then negotiate with them so that you can pay them and protect the home from further liens. I don't like the idea of your paying for the original debtor but there's no way out if he doesn't listen. At least it's better than getting calls from collection agencies and facing their harrassments instead of the original debtor undergoing these things.
This may not be a very good financial solution but certainly a way to get out of this mess. :)
good luck