Can a lender force property into foreclosure and take title with existing medical liens against the property?
Get Legal Help Today
Compare Quotes From Top Companies and Save
Secured with SHA-256 Encryption
Can a lender force property into foreclosure and take title with existing medical liens against the property?
Short sale. Title has medical liens of $17000 to hospital paid through Medicare. The remaining title holder had no knowledge they were filed. What happens now?
Asked on July 23, 2010 under Real Estate Law, Illinois
Answers:
MD, Member, California Bar / FreeAdvice Contributing Attorney
Answered 13 years ago | Contributor
If a bona fide purchaser took title in good faith with no knowledge in any way shape or form, theoretically the person could take title free of the liens. However, in most land and home sales, the liens have been recorded, and if recorded properly (either through the grantee or grantor index), then the person who is purchasing should have constructive if not actual knowledge of the liens. The title insurance/title search process is for this very purpose. If the seller did not inform the buyer, and the lender did not inform the buyer in any disclosures, then theoretically there was a cloud on title and the buyers did not purchase free and clear title. A number of events could occur from here: either the lien holder (medical) is out of luck, the sale must be rescinded or the lien must be taken care of by the seller outside of this home sale.
IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although AttorneyPages.com has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.