PDA

View Full Version : Is this legal? ...and what can I do about it?


kepp
07-26-2006, 08:36 AM
Any realtors or real estate lawyer-types at the planet?

I received a certified letter from a law firm informing me as "an interested party" that my house was going to be auctioned off next month to collect on a defaulted loan that the house's previous owner had. They gave us one week's notice until the house is "listed" and less than a month until the actual auction.

First, is this legal?

Second, what can I do about it?

I've already contacted my realtor and US Bank, who owns our mortgage note and, from what I've been told, title insurance should take care of it since the loan apparently was not discovered at the time the title was issued. What makes me nervous is that we've heard that from everyone EXCEPT the title companies involved. Should I secure a lawyer?

So, there you have it. What's a guy to do?

Brock
07-26-2006, 08:41 AM
I'd seek immediate legal counsel. I mean right now.

DaKCMan AP
07-26-2006, 08:44 AM
Get a lawyer yesterday.

KC Jones
07-26-2006, 08:49 AM
Stop wasting time posting on the planet and retain an attorney... and yes, this is what title insurance is all about.

kepp
07-26-2006, 08:53 AM
Thanks...in process of retaining a lawyer.

Saulbadguy
07-26-2006, 08:55 AM
You should be fine.

Amnorix
07-26-2006, 08:57 AM
Get a lawyer. I'm not sure about the rules in your state, but around here, your mortgage company at least has title insurance, and you might have title insurance for yourself as well.

Be very clear when you are retaining the lawyer -- this is a real estate foreclosure / title insurance matter. Not every lawyer can do more than spell those words. I, for example, only know enough to recognize the issue, and that I would need to walk down the hall to talk with another lawyer who knows WTF to do. :)

Hog Farmer
07-26-2006, 08:57 AM
May I suggest Johny Cochran....... OH Wait!

kepp
07-26-2006, 09:00 AM
You should be fine.
Boy, I hope so. This is our first house and this came out of the blue. I guess we could live in our minivan....down by the river...
http://content.answers.com/main/content/wp/en/d/d9/Matt_Foley%2C_Saturday_Night_Live.jpg

ChiefsfaninPA
07-26-2006, 09:05 AM
This is exactly what you purchased title insurnance for. You did didn't you?

Hog Farmer
07-26-2006, 09:06 AM
Title Insurance should pay for any fee's associated with retaining a lawyer and any related expenses.

StcChief
07-26-2006, 09:15 AM
Title insurance will save your ass.

Fire Me Boy!
07-26-2006, 09:16 AM
Most mortgages require title insurance, depending on how much was financed. More thn 80 percent or so and most places require it.

kepp
07-26-2006, 09:38 AM
This is exactly what you purchased title insurnance for. You did didn't you?
Yes, we did get it. It was mandatory given our 90/10 financing.

Ari Chi3fs
07-26-2006, 10:00 AM
Looks like Ill be doubly sure to get title insurance, as Im buying my first home.

heh.

I love the planet.

Amnorix
07-26-2006, 10:12 AM
Title Insurance is annoying in that it's something that 99.9999999999% of people will never need.

But if you're in that 0.0000000000001% bracket, and you don't have it, you are so thoroughly f***ked that it's not even funny.

kepp
07-26-2006, 10:13 AM
As I get deeper into this, its becoming clearer what has happened. The previous owner's loan - the loan that they are saying she defaulted on - was actually paid off by the title company at the time of closing. They have the cashed check and everything. It looks like the check was simply deposited in the wrong account/place. The title company is still researching it, but they are preparing to get their legal dept involved.

But here's the kicker...guess who "they" are that messed up the deposit and now are trying to collect the "debt"? US Bank! The same bank that owns my mortgage note! Gotta love that inter-departmental communication in big businesses, huh?

So, will US Bank sue themselves out of a $200K mortgage to recover $50K?

KingPriest2
07-26-2006, 10:23 AM
Looks like Ill be doubly sure to get title insurance, as Im buying my first home.

heh.

I love the planet.

YOu are fine. YOu live in Kansas and all the closings I have had in KS always had TI.

The one thing you might now like is the Kansas Mortgage tax which is .0026 of the sale price.

I have been closing loans for 6 years now and never once there was not Title insurance.

Bwana
07-26-2006, 10:34 AM
Wow! As stated above, as long as you have the insurance, you will be fine, but I would be raising all kinds of hell for putting me through this and wasting a bunch of my time. Seriously, if this was me, I would call them up and my first question would be "what kind of a rat soup eating, low test, Mickey Mouse, fly by night outfit are you clowns down there anyway?" "Pull your heads out of you anal flow holes, get this CF fixed and call me back with my apology by tonight!"

ChiefButthurt
07-26-2006, 10:45 AM
There are two types of title insurance. The mandatory title insurance protects the lender and in Ohio you have no choice but to purchase that insurance. Some do not purchase the optional type that protects the borrower. I have never been burned, but we always purchase insurance to protect our interests. Of course we're insurance freaks though.

kepp
08-07-2006, 04:47 PM
For those interested - I just received word from my title insurance company's legal counsel that U.S. Bank has decided to cancel the foreclosure/sale of our property. The title company actually did their jobs...a very refreshing thing these days.

Let this serve as a warning for those thinking about skimping on the title insurance.

Garcia Bronco
08-07-2006, 04:54 PM
The Title search should have identified that there was not a clean title on the property at closing. It sounds like a bunch of BS to me. Either...as everyone has said...this is what Title insurance is for. But I don't think the can auction it off...at the very worst I think the title insurer will have to pay the defaulted loan should it actually exist.

Garcia Bronco
08-07-2006, 04:55 PM
Title Insurance is annoying in that it's something that 99.9999999999% of people will never need.

But if you're in that 0.0000000000001% bracket, and you don't have it, you are so thoroughly f***ked that it's not even funny.

The preimum is so low and a one time charge...you'd have to be a moron not to get it.

kepp
08-07-2006, 05:01 PM
The Title search should have identified that there was not a clean title on the property at closing. It sounds like a bunch of BS to me. Either...as everyone has said...this is what Title insurance is for. But I don't think the can auction it off...at the very worst I think the title insurer will have to pay the defaulted loan should it actually exist.I was told that they can, indeed, auction the property if they have a valid claim. I was also told by my title insurance co. that they would buy the mortgage before they let that happen.

Chief Henry
08-07-2006, 05:13 PM
Stop wasting time posting on the planet and retain an attorney... and yes, this is what title insurance is all about.


Zactly...

Teddy Jack Eddy
08-07-2006, 05:15 PM
Wow! As stated above, as long as you have the insurance, you will be fine, but I would be raising all kinds of hell for putting me through this and wasting a bunch of my time. Seriously, if this was me, I would call them up and my first question would be "what kind of a rat soup eating, low test, Mickey Mouse, fly by night outfit are you clowns down there anyway?" "Pull your heads out of you anal flow holes, get this CF fixed and call me back with my apology by tonight!"
You forgot lightweight and chickenshit.

Chief Henry
08-07-2006, 05:16 PM
For those interested - I just received word from my title insurance company's legal counsel that U.S. Bank has decided to cancel the foreclosure/sale of our property. The title company actually did their jobs...a very refreshing thing these days.

Let this serve as a warning for those thinking about skimping on the title insurance.



Isn't it great when the BS problems finally get solved.

JohnnyV13
08-07-2006, 05:16 PM
I was told that they can, indeed, auction the property if they have a valid claim. I was also told by my title insurance co. that they would buy the mortgage before they let that happen.


You realize, of course, that's not because they are nice guys. They would simply be minimizing the damage from the lawsuit you'd file against them.

DJ's left nut
08-07-2006, 06:38 PM
There are legitimate wild deed problems that make it hard to find some titles. Off the top of my head I can't come up with a hypothetical, but it usually happens when someone further back in the chain of title sells two deeds, one of which is never recorded. That is technically still a legal deed and depending on what happens with bonafide purchers and other lunacy down the line, it can still be valid (if the other party didn't record his deed).

Some states also have very bad title registry systems. A cheap title search company likely won't have it's own database, in which case they are at the mercy of the dusty volumes down at the county courthouse...which are a complete charley foxtrot. The Torrens system never caught on in the US due to the cost associated with it (which would make home titles like car titles, it'd be almost impossible to miss them), so unless there is a good index, some of those title can slip through the cracks without anyone really being negligent.

Also, there's a difference between title 'assurance' and title 'insurance'. 'Assurance' is just the search, but they'll make it very clear that if something turns up later and that something was not covered during their search (which is going to be the outer bounds of their contract), then they are not liable. Now if you nutted up and bought the actual 'insurance', that's a guarantee of sorts that while the title is clear, they're on the hook for the damages if it isn't.

Glad things worked out for you, this kind of stuff can get extremely messy. Now as soon as you have 'clear' title, go to the local recorder of deeds and record your title. You are still the legal owner even if you don't record it, but there are a lot of legal issues that could surface as far as priority of title is concerned that you can avoid by recording your deed.

Good luck with the new place.

greg63
08-07-2006, 06:44 PM
...What everyone has already said.

4th and Long
08-07-2006, 06:48 PM
...What everyone has already said.
What greg said. :D

JBucc
08-07-2006, 06:50 PM
Probably the opposite of what they said...

greg63
08-07-2006, 07:01 PM
What greg said. :D


:thumb:

Mosbonian
08-07-2006, 07:20 PM
Wow! As stated above, as long as you have the insurance, you will be fine, but I would be raising all kinds of hell for putting me through this and wasting a bunch of my time. Seriously, if this was me, I would call them up and my first question would be "what kind of a rat soup eating, low test, Mickey Mouse, fly by night outfit are you clowns down there anyway?" "Pull your heads out of you anal flow holes, get this CF fixed and call me back with my apology by tonight!"

Hey now...leave my buddy Mickey out of this...he didn't do anything wrong! :p

mmaddog
*******

4th and Long
08-07-2006, 07:39 PM
Hey now...leave my buddy Mickey out of this...he didn't do anything wrong! :p

mmaddog
*******
ROFL

Hey dog, ol' buddy, you know what the difference between a trampoline and a lawyer is?

You should always take off your golf shoes before you jump on a trampoline.

:D

Mosbonian
08-07-2006, 08:06 PM
ROFL

Hey dog, ol' buddy, you know what the difference between a trampoline and a lawyer is?

You should always take off your golf shoes before you jump on a trampoline.

:D

ROFL ROFL ROFL

Good one 4th....

mmaddog
*******

alanm
08-07-2006, 08:25 PM
For those interested - I just received word from my title insurance company's legal counsel that U.S. Bank has decided to cancel the foreclosure/sale of our property. The title company actually did their jobs...a very refreshing thing these days.

Let this serve as a warning for those thinking about skimping on the title insurance.
Now that you have a lawyer on retainer doing squat, have him sue your bank for emotional distress. ROFL

Bob Dole
08-07-2006, 09:07 PM
For future reference, it never hurts to be close personal friends with a woman who runs a title company.