Record of Foreclosure

[bbqpops]

State of Nebraska

In 2012 I entered a land purchase with house. I was buying the home and land directly from the current owner, with the owner financing the deal. Everything was done correctly, with my name being registered as the legal owner of the property with the county and state.

In 2015, I fell ill and couldn't make the payments any longer. In early 2016, the previous owner initiated a foreclosure on me. Rather than fight it, my family moved from the home, and the previous owner took the property over. I have no foreclosure listed on my credit report.

Fast forward to September 2021. My health is vastly improved, as well as my financial and credit capabilities. We decide to buy the home we are currently renting. We find a mortgage broker, who initiates approval, and sends to underwriting. Underwriters ask about this foreclosure I had in 2016. I try to explain the situation to my mortgage agent. Underwriters ask for supplemental documents., but I have none.

I call the court, ask for some sort of record of this foreclosure. Surely this would need to be recorded by the courts, correct?

They have no record

Where else could I find any record of the foreclosure? Or, am I simply SOL?

The underwriters are finding it show up on one of my records, but it isn't on my credit report.

I'm stumped. What is my next move?

Thanks.

 

[quincy]

State of Nebraska

In 2012 I entered a land purchase with house. I was buying the home and land directly from the current owner, with the owner financing the deal. Everything was done correctly, with my name being registered as the legal owner of the property with the county and state.

In 2015, I fell ill and couldn't make the payments any longer. In early 2016, the previous owner initiated a foreclosure on me. Rather than fight it, my family moved from the home, and the previous owner took the property over. I have no foreclosure listed on my credit report.

Fast forward to September 2021. My health is vastly improved, as well as my financial and credit capabilities. We decide to buy the home we are currently renting. We find a mortgage broker, who initiates approval, and sends to underwriting. Underwriters ask about this foreclosure I had in 2016. I try to explain the situation to my mortgage agent. Underwriters ask for supplemental documents., but I have none.

I call the court, ask for some sort of record of this foreclosure. Surely this would need to be recorded by the courts, correct?

They have no record

Where else could I find any record of the foreclosure? Or, am I simply SOL?

The underwriters are finding it show up on one of my records, but it isn't on my credit report.

I'm stumped. What is my next move?

Thanks.

The seller of property under a contract for deed (land contract) has the option to report the sale of the property to credit reporting agencies or not. Many don’t. A forfeiture of the contract for deed (walking away from the contract) would not, therefore, appear on your credit report.

You forfeited the property rather than the seller foreclosing on the property.

 

[bbqpops]

Ahhh. Gotcha.

But, how do the underwriters see this "foreclosure"?

Record of deeds?

 

[quincy]

Ahhh. Gotcha.

But, how do the underwriters see this "foreclosure"?

Record of deeds?

They probably did a background check, which revealed your previous addresses and your history at those addresses.

 

[adjusterjack]

Surely this would need to be recorded by the courts, correct?

They have no record

Where else could I find any record of the foreclosure? Or, am I simply SOL?

It appears that foreclosures in Nebraska are generally non-judicial which means there would be no court records. The seller, however, may have had to record certain notices and documents in order to get your name off the record.

Check with the County Recorder where the home is located and see if there are any recorded documents with your name on it.

 

[bbqpops]

It appears that foreclosures in Nebraska are generally non-judicial which means there would be no court records. The seller, however, may have had to record certain notices and documents in order to get your name off the record.

Check with the County Recorder where the home is located and see if there are any recorded documents with your name on it.

Thank you. Ill try this next.

 

[bbqpops]

Thanks again for all the help.

In my ignorance, I didn't know that all real estate dealings are public record.

Luckily for me, I was able to go to the County Recorder of Deeds Website, and found two solitary documents pertaining to my case.

First was the Warranty Deed, spelling out the details of my purchase, and a Notice of Default, spelling out the conditions for me to retain the property. Instead of meeting those conditions, we surrendered the home and property.

So, would there be a document stating there is a foreclosure, or is the Notice of Default the first tooth in the cog?

There were no additional documents with my name available.

 

[adjusterjack]

First was the Warranty Deed, spelling out the details of my purchase, and a Notice of Default, spelling out the conditions for me to retain the property. Instead of meeting those conditions, we surrendered the home and property.

That's how your lender found out about it. In addition to credit reports it's routine to run a search of recorded documents pertaining to the property you are buying and you.

So, would there be a document stating there is a foreclosure, or is the Notice of Default the first tooth in the cog?

There were no additional documents with my name available.

There should normally be two more steps in the process, the sale of the property and possibly a deficiency lawsuit. If you haven't been sued by now you probably don't have to be concerned about it.

Next thing to look for at the recorder, or assessor, is who owns the property now. The same owner you bought it from? Was it sold to somebody else? When? Obtain any document regarding the property that have been recorded since 2016.

 

[PayrollHRGuy]

So, would there be a document stating there is a foreclosure, or is the Notice of Default the first tooth in the cog?

It doesn't take a rocket scientist to see that the property is back in the name of the seller. That along with the Notice of Default is what they based their decision on.

 

[bbqpops]

That's how your lender found out about it. In addition to credit reports it's routine to run a search of recorded documents pertaining to the property you are buying and you.



There should normally be two more steps in the process, the sale of the property and possibly a deficiency lawsuit. If you haven't been sued by now you probably don't have to be concerned about it.

Next thing to look for at the recorder, or assessor, is who owns the property now. The same owner you bought it from? Was it sold to somebody else? When? Obtain any document regarding the property that have been recorded since 2016.

The absolute last record for that property, doing a search with the property details, and not simply my name, revealed one last document that shows the legal details of the transfer of ownership back to the original owner.

This is a small town, and I know, as fact, that the owner's son and family are currently residing in the home and on the property. There has not been any other transfer of ownership between those two parties.

I feel I have all the documents I need to satisfy the underwriters curiosity. Alas, it may be the same information that ends my quest for home ownership for now.

However, I still thank you all for your help.

 

[adjusterjack]

I feel I have all the documents I need to satisfy the underwriters curiosity.

Then present it and see how it goes.

Alas, it may be the same information that ends my quest for home ownership for now.

Not necessarily. Other lenders, banks, credit unions, may have different ways of looking at it.

 

[quincy]

The absolute last record for that property, doing a search with the property details, and not simply my name, revealed one last document that shows the legal details of the transfer of ownership back to the original owner.

This is a small town, and I know, as fact, that the owner's son and family are currently residing in the home and on the property. There has not been any other transfer of ownership between those two parties.

I feel I have all the documents I need to satisfy the underwriters curiosity. Alas, it may be the same information that ends my quest for home ownership for now.

However, I still thank you all for your help.

I would check out other lenders if the one you are working with now won’t finance a house purchase for you. What will be important is being able to show to the lender your current financial ability to support a loan.

By the way, your original contract for sale should have included a clause on forfeiture. You might want to find your copy of that document if you haven’t located it already.

Good luck.