Is there a statute of limitations on a mtg?

[catwoman!]

What is the name of your state? New Jersey

My ex-husband and I gave a 30-yr second mortgage to an attorney who bought our professional building in 1976. He was to make payments until 1996, at which time a balloon payment would become due. The attorney sometimes paid monthly, and at other time fell behind, at any rate, by the time 1996 arrived, he was at least nine months in arrears at least for the past nine months, plus other payments he had missed in the intervening years.

My ex and I had gotten divorced in 1980, and had split the payments when they arrived. In 1996, neither of us did anything to ask for the balloon payment, since our kids being out of the house by then caused us to not see each other anymore, and I think we really didn't know when the balloon payment was to come due. Basically, nobody did anything until recently, when the attorney-buyer contacted me to try to settle this mortgage. It seems he has a buyer and wants to sell the professional building.

I have spoken to a few people (still haven't contacted an attorney -- this is too new) who have indicated that since we didn't go after him in 1996, the SOL might have run and we wouldn't be entitled to anything at this late date. I disagree, because I don't think there can be a statute on a mortgage. Just like a mechanics lien for unpaid contractor bills, it simply sits there and becomes due upon the sale of the property that is securing said mortgage. Am I right?

Thanks in advance!What is the name of your state?

[Zigner]

Originally Posted by catwoman!

Basically, nobody did anything until recently, when the attorney-buyer contacted me to try to settle this mortgage. It seems he has a buyer and wants to sell the professional building.

What kind of settlement is he offering?

[catwoman!]

He didn't offer anything -- he asked me what I wanted (he was erroneously under the impression that I had been awarded the entire mortgage in the divorce, thus, he only dealt with me). I contacted my ex, and with the aid of my current husband (a mathematician), I attempted to reconstruct what payments the laywer-buyer had missed in total, added that to what the balloon amount would have been in 1996, and then used the interest figures, as well as the late payment penalties during all the intervening years to arrive at a figure that would surely startle him. I have not had a response from him.

It seems to me that the lawyer-buyer would not have even contacted me if this mortgage wasn't still recorded on the deed, and if he didn't have to remove it to go to closing. (Otherwise, we should BE at the closing!) So, he must be under the impression that no SOL would remove this obligation. Additionally, my ex, who was also a lawyer during his career, also didn't say anything about an SOL.

Any confirmation?

[BoredAtty]

The statute of limitations on the underlying debt is 6 years. However, the statute of limitations on the right to foreclose is 20 years. See Security National Partners v. Mahler, 763 A.2d 804 (N.J. Super. A.D., 2000).

IMO, the above means that your lien must be satisfied before the building can be sold since it has not yet been 20 years since default. If the building sells for more than what is owed to you, then all is well. If the building sells for less than what is owed to you, then you have no further recourse against the debtor since more than 6 years has passed since default.