No Deed/Title after Foreclosure and Chapter 7?

Question

My direct marketing led me to a homeowner with the following situation:

He went through a foreclosure several years ago; to which he thought he lost the home, and then it sat vacant for four years. He apparently still owned the home and paid off some of the back taxes according to him. He then went through a chapter 7 bankruptcy which was delayed 3 times because they could not track the deed down. He said it went through but he is still on the county record as the owner and owes about 16K in back taxes and is getting hit with code violations. Is there any chance he can still own the property free and clear? That's what he says but without title he can't sell. he wants out- does anyone see a path to a solution here?  I am not sure if a title co will run a search or agree to do it without a fee? Any advice on where to start is appreciated:)

Wayne Brooks · Answer

This is all useless speculation until you find out the true status.  Get a title search, if you don't know how to find the basics.  The deed is not "missing", it's recorded in your local courthouse.  Find out Exactly what has/has not happened with the foreclosure proceedings/resolution, Yourself.  Stop depending on what the seller says.

Below are the online links for your county.  If you can't find it here, go down to your local offices and learn how to find this stuff-it's crucial to what you're trying to do.

http://bis-net.net/ECCounty/search.cfm

http://eauclairecowi.wgxtreme.com/

https://tapestry.fidlar.com/Tapestry2/Default.aspx    (paid service)

Greg Braun · Answer

Dave NA Here are the numbers as I see it: The back taxes are around 15K, Code violations must be around 2k and counting ($100/week) according to the owner. I'd say the ARV is around $105K with about 40K in repairs. If the quiet title took awhile the code violations could really ad up. I don't have any experience with quiet title action, do you know if there is considerable cost and time involved?

Greg Braun · Answer

@Wayne Brooks Thanks for the info. It is in another county buffalo but I managed to get some information. The warranty deed was in his name and then there was a mortage filed along with lis pendens ( I believe these are the liens on title) The last 3 recorded documents are labeled "Release of Lis Pendens" with several banks (4) listed as grantors. I will have to wait to visit the county as I am on a business trip, but that sounds like a good first order of business.

Kristine Marie Poe Do you know what a good first step would be on the legal side? Contact the BK lawyer the owner used or does the courthouse keep public records of such judgments that can be accessed? From what the owner said you may be right and the bank never took it to sale.

Rick H. · Answer

Why-oh-why do people resist using my PETIO research format?

Property

Equity

Title

Interests

Opportunity

I once had an owner tell me something that wasn't accurate. That was my very first deal. Nothing has changed since. Do your own homework.

Don't join the Legion of Lazybones.

Account Closed · Answer

If release of lis pendens are the last documents recorded, the borrower is still the owner of record. Superior court cases are public record.  Go look at the last activity on the case. If the lenders pulled their lis pendens and did not file new ones then there will be no court order and no foreclosure. The borrower may be confused about the order of things and that during the BK the lender may have released the LPs.

Regardless, whatever mortgages are on the property are still there unless you can find a release of some kind. Tread carefully.  The property is likely over encumbered and not much to get excited about except as possible short sale.

Wayne Brooks · Answer

Generally, a Release of Lis Pendens means the foreclosure is withdrawn, and will likely be refiled.  It was probably released due to incomplete/incorrect documents at the original foreclosure filing.  The property will certainly not be free and clear.  You're getting closer.

Account Closed · Answer

Foreclosure is judicial in WI.  If a transfer post foreclosure is not showing in the chain of title, then you'd want to look at the court case to see what happened.  Maybe the court case was never finalized, maybe it's a matter of documents from the courts or the lender that have not been recorded. I think there is a misunderstanding on the seller's part of what happened during his BK.

There's not much of a chance that the borrower owns it free and clear.  That being said, weird things happened and lots of things fell through the cracks in the foreclosure world post Bubble.  I'm betting that the lender got a foreclosure judgment but failed to take it to sale.

Let us know what you find out!

Dave Toelkes · Answer

Are you sure this is a property you can profit from?  Back taxes, code violations, and most likely a quiet title lawsuit could be costly path to ownership.

Greg Braun · Answer

@Joe Gore Yes- that is what i was thinking. The bankruptcy lawyer could not find the deed so i didn't think it would be that easy, but I guess I have to start somewhere. Would you suggest I get it under contract and put a clean and clear title contingency before proceeding any further, or is it best in there situations to get the facts first?

Thank you

Account Closed · Answer

Why would a title company run a search for free? There is a deed somewhere and just pay a title company to run the search, and they will find all the liens and the deed.

Joe Gore

No Deed/Title after Foreclosure and Chapter 7?

Most Popular Reply