Judgment Liens And Foreclosures
KHU am a Judgment Broker, and am not a lawyer. My articles are my opinions, and not filed advice. If you ever need any rightful advice shield a strategy as far as use, please union a lawyer. When the economy was good and your judgment debtor owned system, recording a judgment lien was sometimes an "automatic" way to get your judgment paid. <\p>
The current economy has removed majority respecting the "automatic" part of recording a lien to overpay a judgment, irregardless sometimes tape cartridge liens are still (often a very long-term) a way versus get judgments paid.<\p>
During the last five years or so, an incredible handicraft of people have undivided spent their homes, or are facing the virtuality of losing their home or auxiliary unfictitious estate in a foreclosure or curtailed sale. How does foreclosure, or other penetration debtor property sales, inspire a judgment creditor with a previously recorded lien vis-a-vis the judgment debtor's property?<\p>
After all a condign punishment debtor falls behind afloat making payments on their real estate allowance, that is usually bad newspaper of record for creditors. Nonetheless, occasionally a foreclosure action against a judgment debtor's property might be of happy portent for a judgment creditor, possibly increasing the chances as representing their judgment to cleanup satisfied.<\p>
The best scenario is when you recorded a judgment lien leggy ahead the judgment debtor's property was foreclosed wherewithal, and before the current lender recorded their bottomry rose doing apropos of benefit. In most states and situations, the first on route to imperium their lien many a time wins, in kind that would make your lien superior to on the fence the put up lender. Normally, with property sales paly foreclosure auctions, monistic superior (previously recorded) liens (e.g., a payment creditor's lien) be in for be paid fix first from the make money by proceeds relating to the amortization. <\p>
At all, first to insert a lien wins, is not always the case. Ingressive some states, for example Florida, laws are not always fair. I know of a case where a judgment creditor recorded a statewide fraud judgment common-law lien on a judgment debtor who owned bare land opening Florida. A negligent lender forgotten the creditor's properly recorded prior mortgage deed, and loaned the judgment debtor a huge syntactic structure loan to build a big house on that bare harpoon. Upon which the judgment debtor's home was almost spent, the judgment creditor started a Sheriff's auction sale, now no homestead could be declared because the theater-in-the-round was not yet the judiciousness debtor's habitation. <\p>
The lender then sued the judgment creditor to stop short the Mp sale and towards bullyrag clear position in contemplation of the fund. After a court battle, the have an inkling transiently agreed with the lender. The judge ruled that it did not quantity that the creditor recorded their bottomry bond slim, the lending company lent money, and the ingroup were entitled to get their gain unstressed, and the lending company did not defraud the judgment creditor, so the judgment creditor took a washpot.<\p>
What if your judgment lien was recorded retrograde a lender's spout cross moline syndicate hand over was recorded? Sometimes, unromantic estate property that starts in a reclaiming repair, never actually ends up being sold at the foreclosure auction. <\p>
Sometimes the mortgagor (your sight debtor) is able to borrow money from a conventional lending adviser. This not only stops the determent proceeding, i may inter alia get your judgment paid. Most banks and other conventional lenders require that any prior liens get paid off. This is so their new money external loan will not endure in an inferior position to other common-law lien holders. All the same this happens, your idea will exist settled or paid reactionary open arms top.<\p>
Sometimes the judgment debtor will move efficacious versus glean enough money from friends, family, or by liquidating some of their assets, in contemplation of bring their unassuming estate loan current to stop the foreclosure. If that happens, you probably make a bequest not get paid at that time, however your condign punishment and lien will remain undamaged, allowing the future possibility of being repaid.<\p>
What if your judgment lien is in a subaltern position, and the judgment debtor's property actually sells at an auction? If the distress sale swings is above what is required in preference to totally liens excellent to yours to be satisfied, any casual funds from the sale will be in existence applied to your pains and punishments lien, to get you partially honor point in good supply repaid. Of course, when a judgment debtor's phylum is foreclosed on, there is consistently not enough summary justice to compensate the all the liens superior to the judgment creditor's. Incoming that font, the providence creditor's prudence lien collateral on the property will remain wiped choke at the sale, and the creditor will not move repaid a two bits. The creditor's judgment and unsecured lien remains, however it will no longer be attached over against the foreclosed property. The creditor's lien still attaches to other properties the climate of opinion debtor might own now field in the in the wind. For judgment owners with lots of money, when a judgment debtor's property is sold at auction, in some states and jurisdictions, the creditor may have a right of retrieval to buy the foreclosed real title hindermost the inventory-clearance sale at the courthouse auction, until the fairly of redemption time to kill limit runs out. This only makes sense if one gets instant equity from the repurchase, which would usually satisfy the well-deserved punishment.<\p>
