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  1. #1
    lilygrl08 is offline Junior Member
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    Buying a house with a lien on the property...

    What is the name of your state (only U.S. law)? NY

    I am in contract for a townhouse and we just found out that there is a lien on the house. Is it possible for the seller to back out of the deal and not sell us the home at this point.

    lilygrl
  2. #2
    seniorjudge is offline Senior Member
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    Why do you want to buy someone else's lien?
    There are two rules for success:

    (1) Never tell everything you know.
  3. #3
    lilygrl08 is offline Junior Member
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    I am not buying someone else's lien obviously - we just found out there was a lien on the property and they have to take care of it.
  4. #4
    seniorjudge is offline Senior Member
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    Quote Originally Posted by lilygrl08 View Post
    I am not buying someone else's lien obviously - we just found out there was a lien on the property and they have to take care of it.
    Then explain what the problem is exactly...you are not being clear.

    What kind of lien?
    There are two rules for success:

    (1) Never tell everything you know.
  5. #5
    lilygrl08 is offline Junior Member
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    Okay let me try to explain - this is all very new to me - first time home buyer! So anyway - we are in contract and during title search it was determined there is a lien on the house. The seller inherited the property a few months ago - i guess he was unaware of this lien at the time the signing occurred. We were all set with a closing date (which was supposed to be today) and now we are being held up due to this lien. I guess my main question is if the seller is able to back out of the deal for any reason? Does this make sense at all?
  6. #6
    seniorjudge is offline Senior Member
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    Okay, one more time and then I'm through: What kind of lien?
    There are two rules for success:

    (1) Never tell everything you know.
  7. #7
    lilygrl08 is offline Junior Member
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    From what they told us - the original owner (the man who passed away) was arrested and/or in jail and they placed a $150,000 lien on the home. So I am assuming the man who inherited the property is responsible?
  8. #8
    seniorjudge is offline Senior Member
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    Quote Originally Posted by lilygrl08 View Post
    From what they told us - the original owner (the man who passed away) was arrested and/or in jail and they placed a $150,000 lien on the home. So I am assuming the man who inherited the property is responsible?
    The lien is on the land, not a person.

    What does your contract say EXACTLY about the seller being unable to provide good title?
    There are two rules for success:

    (1) Never tell everything you know.
  9. #9
    lilygrl08 is offline Junior Member
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    I do realize the lien is on the home....but doesnt the lien need to be taken care of before the house is sold.

    I would have to call my lawyer to ask him about the contract.
  10. #10
    seniorjudge is offline Senior Member
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    Q: Doesnt the lien need to be taken care of before the house is sold.

    A: Yes, unless the buyer doesn't mind that the lien is there and buys the place anyway.
    There are two rules for success:

    (1) Never tell everything you know.
  11. #11
    nextwife is offline Senior Member
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    If the lien is in question or being litigated, it is possible for the title company to consider providing "affirmative" coverage over the lien IF sufficient funds are withheld from proceeds to cover the entire lien, plus all interest anticipated while any legal action is worked out. Examples would be a case in which a mechanics lien was placed because the owner refused to pay for substandard work and the contractor wouldn't correct and a lawsuit resulted.
  12. #12
    chgobroker is offline Junior Member
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    Property Leins

    Most properties have leins. A lein may not get in the way of the closing of the transaction. What is the value of the home? Is the value greater than the lein? If so, the estate will most likely pay the lein at closing to provide clear title. If the lein is more than the contract value the estate may bring money to the table to complete the transaction. Do you have an attorney to examine title? Some title companies will insure over the lein. If you are mortgaging the property a lender may not want to provide funds if there isn't enough equity above the lein to cover them.
  13. #13
    HomeGuru is offline Senior Member
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    Quote Originally Posted by lilygrl08 View Post
    I do realize the lien is on the home....but doesnt the lien need to be taken care of before the house is sold.

    I would have to call my lawyer to ask him about the contract.
    **A: and when you talk to your lawyer ask him/her about the lien.
  14. #14
    Incognito is offline Junior Member
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    sounds more like a mortgage lien. How old is the lien and when was the last activity on the lien?

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