All Forum Posts by: Tom Gimer

@Dion DePaoli Jackie responded and clarified.

The fact that the DoT was recorded is not the end of it. You can record a DoT and still not have a valid lien due to problems with the legal description or the instrument itself. 

But something else is up here... the title company discovered Jackie's lien in their search but took an affidavit from the seller that she would pay it outside of closing? That's unheard of. And if it turns out to be true, the ultimate liability will fall on the title company's E&O -- unless the seller bucks up.

@Dion DePaoli I disagree. That lien may be in jeopardy. One thing that remains to be seen here is whether Jackie Lange's lien was properly recorded and secured an interest in the subject property. She said the title company initially told her to go and deal with the seller about this. That tells me they may not have found her lien in their search... and that isn't always due to a title company error.

So, had Jackie been issued a lender's policy concerning her DoT/mortgage, and for whatever reason (error in legal description, failure to record, etc.) the DoT/mortgage was not a valid lien, her policy might protect her in this situation.

It depends on the value and/or type of the underlying claim giving rise to the lis pendens. Most likely — no. And if somebody else is claiming ownership, your sale is absolutely not going to happen.

@wayne brooks 

@Wayne Brooks Title insurance guarantees lien position... whenever it is questioned. That's really all that matters. Most of these messes involve the same handful of insurers figuring out who holds the short straw.

I said you can't foreclose the prior owners' interest. 

Sounds like a lot of legal work will be done here when what should have happened did not. 

@Jackie Lange You can't foreclose a prior owner -- they are out of title.

But yes, a foreclosure against current owner should get the ball rolling.  

Buyer should have paid for lenders and you would have limited work and zero out-of-pocket here. 

Let us know how it all works out.

Originally posted by @Lance Lvovsky:

In a 1031, the taxpayer taking title to the property must be the same as the taxpayer relinquishing the property (with limited exceptions). If you have a property in the name of your wife and yourself owned, why don't you transfer title to the LLC (with your wife and you as members) and then initiate the 1031.

Thank you, sir. This answers the exact question I was asked by a client the other day.

Can you point me to the code section or other resource that lists the exceptions? 

@Wayne Brooks One more thing... the existence of an owner's policy is irrelevant in this scenario. There is nobody "on the hook" for this other (1) than the owner who absconded with the BP poster's funds and/or (2) the title company who botched this deal ... unless a lender's policy was issued. And a lenders policy should have been issued as it would have been pennies on the dollar to do so.

@Wayne Brooks Lender was supposedly in first lien position. What's the point of title insurance if you don't get paid first? 

The coverage decreases as the loan is paid. Sounds like ZERO was paid.  

Was a lenders policy issued in connection with your seller financing, or just owners coverage? That’s the crucial issue. If you have a lenders policy, file your claim and you’ll have counsel. No lawsuits needed (yet). If you don’t have a lenders policy, that’s another matter to address with your title company in your lawsuit.

Do you have a lenders title insurance policy? Make a claim.