Bankruptcies, judgments and liens…oh my!
Unexpected medical bills, loss of a job or spouse, or divorce among many other things can result in financial troubles… in some circumstances, there just isn’t enough money to pay the bills; this can result in Court Judgments, Tax liens, or even Bankruptcy.
Sellers (and buyers) are sometimes surprised to find out that any court judgment for things like unpaid child support, medical bills or credit cards, and tax liens, when recorded in the county real estate records, where the property is located, will affect the sale of their property.
Judgments and tax liens, when recorded in the (Colorado) County Real Estate records where the property is located, “attach” themselves to any real estate that a person owns. (Laws vary from State to State- so always seek legal advice in these matters, and in bankruptcy, your bankruptcy attorney will advise you as to what is required to sell your real property.)
When you are selling your property, let your agent know about any of these circumstances/liens that may affect the sale, your net proceeds, or require extra time to negotiate with creditors.
What happens when a derogatory matter belongs to SOMEONE ELSE, but they also have YOUR name?
If the title examiner is not readily able to discern whether it’s you or another person with the same name on a recorded document, they will make a requirement to release the lien from the title and/or ask you to provide proof that you are not the same person named in the judgment, lien or bankruptcy.
Usually you will not get a warning, so it comes as a SURPRISE when the title report is issued and YOUR NAME appears right next to the embarrassing & unflattering court judgment, tax lien, or bankruptcy…that, of course, you knew nothing about!
You see red. You’re upset, “But it’s not me!” you shout!
Usually, the case of “mistaken identity” can be cleared up with the title company by filling out an identity statement or affidavit. When they have more information about you, they can compare the recorded information or even call the creditor, or bankruptcy trustee, to verify and remove the offending requirement.
When the title work is issued with a derogatory matter that has nothing to do with you – try not to get too upset.
We can usually get that resolved and removed fairly easily by giving the title company the information they need.
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Mary Douglas, your Mountain Broker-Associate and REALTOR®
United Country Ponderosa Realty, Red Feather Lakes, CO
www.marydouglas-redfeatherlakes.net
970-231-5756 phone or text- email: mary@redfeatherlakes.com
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