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  1. #1
    Join Date
    Oct 2011
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    3

    Default Mortgage Company Sold House and Land Without Ownership of Part of Property

    My question involves real estate located in the State of: Texas

    A year ago we bought a forclosured trailer house and approximately .40 of an acre of land from a mortgage company. Land was sold to us as one piece of .15 acres and another as .25 acres. Was advertised at this amount of land. We questioned the fact that the tax office showed land was 70 x 90 lot. There were 2 lots listed in closing papers as two lots no sizes mentioned. The mortgage wanted to waiver survey but have a title policy which we agreed to. This last week we were approached by a person claiming that a portion of the land we occupied actually belonged to them and there were several years of back taxes due. This person discovered that this was the case when she renewed her drivers license and the tax office contacted her about taxes. She had sold the land to the people that had the trailer that was forclosed upon. She indicated that she had been paid for the property during a refinance happen on the trailer and property. However the deed nor lein was filled at the courthouse and therefore she was responsible for the back taxes. I have contacted the title company and they have contacted the mortgage company and are researching the problem. There was actually supposed to be 3 lots involved in the sale instead of 2. A portion of the house actually sits on this third lot. I am at a lose as to what to do. They are still looking at the matter but I am concerned of what the outcome will be. Any guidelines for something like this? I have printouts of e-mails from the mortgage company and the sales agent discussing the size of lots and they reinterate what was advertised.

  2. #2
    Join Date
    Sep 2010
    Posts
    19,901

    Default Re: Mortgage Company Sold House and Land Without Ownership of Part of Property

    Contact your title insurer.

  3. #3
    Join Date
    Oct 2011
    Posts
    3

    Default Re: Mortgage Company Sold House and Land Without Ownership of Part of Property

    Contacted Title insurer and they stated that the land that was covered by the title was only what was noted in the papers. Which was the 2 original lots, they say they were not aware of an possible discrepancy in the size of the lots and lot numbers mentioned in the deed. They have spoke to the mortgage company and get an indication that they are not to sure of their position in the matter and that they feel they have done no wrong. Even though they advertised the size of the lots to be larger than they were. I am supposed to have my first conversation with the mortgage companies attorney this coming Monday. Any advise as how I should proceed. I believe there is a mediation clause in the contract, so I may be bound by it for the first step. Not sure how that is handled.

  4. #4
    Join Date
    Jan 2006
    Posts
    38,867

    Default Re: Mortgage Company Sold House and Land Without Ownership of Part of Property

    Most mortgage lenders require at least what is called in my area a mortgage survey. That is a survey that basically provides a piece of paper that shows where the improvements to the land compared to the lot lines are. That or a survey you purchased would have prevented the problem.

    So, now where do you go?

    Well, the lender is kind of stuck because they loaned on a property that has a problem. You are stuck because you purchased a property with a problem. The lender only cares if you default because they get stuck with the property so that really makes it only your problem at the moment.

    one thing is: it is not the sellers (of that third lot) problem actually. If they delivered a deed to that third lot, they no longer own it and are no longer responsible for the taxes. They should have kept a copy of the deed and any paperwork associated with the transfer of the property to whomever. That would relieve them of the tax liability. As a seller, it is not their obligation to ensure the deed is registered although, to avoid problems such as this, it is a good idea to make sure that it is registered.


    The BIG problem is: who actually owns that third lot? If there was never a trust deed or some other type of attachment to it by the bank that loaned the money for the refi, they could not have reclaimed it under foreclosure and the people that borrowed the money still own it.

    This is a huge mess and maybe difficult to clear up, depending on what actually happened with that third lot. That is where the bank is going to have to research their records to determine if they actually included that third lot in their lien. If they didn't, well, the remedy is going to be really tough because the people that the bank foreclosed on most likely still own it. That could be a huge problem. If the bank did properly foreclose on the third lot, they own it and since they did not sell it to you, there is a problem but possibly able to be remedied. Hopefully they simply missed that the third lot was within the foreclosure and, without further expense to you, transfer it to you.

    One other possibility is:

    Somewhere in their records they do have the third lot recorded as under the common lien as they put it under the mortgage of the other two lots and the home and they did actually intend to transfer it to you. That would explain the incorrect lot size compared to what was actually transferred.

    So, did you borrow from the same bank that sold it? If so, it would give them incentive to clear this up. If not, it adds another dimension to the complexity and difficulty of the situation.

    One thing to be very aware of: tax sales. If the lot with the delinquent taxes is up for a tax sale, it would make everything more complex. I would do just about anything to ensure that lot does not go to a tax sale to prevent that added layer of complexity.

    One thing for sure is: if the person that contacted you claiming they still owned the lot did deliver a deed, they do not own the lot any longer and have no claims on it regardless of what is happening at the tax office.

  5. #5
    Join Date
    Oct 2011
    Posts
    3

    Default Re: Mortgage Company Sold House and Land Without Ownership of Part of Property

    Yes the mortgage company that sold it to me is the same one that financed it. I am well aware of the tax problem because there are 7 years of taxes due. I will also go to the tax office Monday to find out what the timetable is for tax lien sale would be.

    Thanks for your info so far, will keep advised

    Wolfman

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