Lien on home and we were looking to close, what to do?

[Rodney Johnson]

My wife and I are purchasing a home, we were to close on April 16, but after a title search was done by the lawyer the title came back with a lien on it. The original closing date was not set for May 14, and it was stated in the contract that the sellers would have an extra 30 days to get the tile cleared if needed. So, we are coming to June 14 and there have been no signs of the title clearing. The sellers real estate agent only says they are working on it, and stated that we could look at other homes for a back up plan. What is there to do? By the way, the sellers did pay the lien off, over ten years ago but did not file with the county court, and the company they went through was bought out by a company then bought out by another company; so they stated it is hard on them to get it settled. Should we really just get our earnest money back? Is this common? We really love the home. Thanks for any responses!

[Brandon L.]

@Rodney Johnson your closing attorney should be giving you options to clear this lein. I would not trust that the sellers paid it and assume it needs to be paid.

[Tom Gimer]

If the lien was paid off 10+ years ago, there is a paper trail... which needs to be shown to the title insurance underwriter. Title will also likely require an indemnity agreement from the seller. Perhaps an escrow of seller funds would also work until the release is obtained from the proper party.

Also the passage of time is important here. No jurisdiction was provided in the question (nor was the type of lien identified) but most liens have a definitive expiration date... look into local law.

[Wayne Brooks]

Absolutely no harm in letting it play out, especially if you really like the home. Until you get in a time crunch, just wait.....this typically gets resolved. 

[Rodney Johnson]

Thanks Tom and Wayne!

[Rodney Johnson]

Yes Brandon,

This is what the lawyer is saying too and trying to collect documents to get it cleared with the court house. It is just taking soo soo long. 

[Rodney Johnson]

@Ian Parrish thank you!! This was an awesome explanation....I will do!