Posted by Royce on March 07, 2011 at 22:03:15:
The attorney called back and said that the judgements would prevent me from being able to QCD the property. I’m assuming he found the information from a title search. I’ll try and get more info tomorrow.
The property is in Minnesota.
Thanks for your responses! They were very helpful.
Contract for deed foreclosure - Posted by Royce
Posted by Royce on March 07, 2011 at 11:53:53:
Hey guys. I have a lakefront property that I sold on a lease to own a few years ago. The tenants were pretty good for a couple of years and I converted it to a contract for deed about 16 months ago.
They have been struggling making the payments for the last several months without mentioning their issues to me. All of the sudden within the last couple of weeks, they missed a payment and I found out that they did not pay the October property tax bill. They have decided that they want to walk away from the home after paying off nearly 20K and doing improvements.
They would like to quit claim deed it back to me at the end of this month and walk away. I contacted the real estate attorney that I used to file the deed and his assistant said that I cannot allow them to simply deed it back to me because they have a couple of judgments against them personally and the particular county attaches judgments to real estate. If I allow it to be deeded back, I would have to accept the judgments. Basically, I’m being told that I have to follow a much more costly foreclosure process even though they are willing to deed it back to me.
I’m waiting for a call back form the attorney but in the meantime, do any of you have suggestions?
Thanks for your assistance!
Royce
Re: Contract for deed foreclosure - Posted by Ken
Posted by Ken on March 07, 2011 at 20:49:09:
Assuming the judgments are attached you may be further ahead to pay them off at a discount or even buy them release them from the property in question and go after the buyer to pay you.You may want to take the quit claim deed and hold it while doing the foreclosure so you can take possession and get the place rerented and producing again quickly
So what’s recorded? - Posted by John Merchant
Posted by John Merchant on March 07, 2011 at 16:02:01:
As I own and operate a Trustee Foreclosure co, doing DOT foreclosures and REC forfeitures, I’m very familiar with this situation.
You should understand that not every judgment automatically attaches to the RE in debtors’ names, so there’s a little more to be looked at before making that call.
Where (what state) is the property?
Did you give them a deed yet? If not, isn’t the RE still in your name?
You could have converted their Lease/Option over to a REC and the RE could still be in your name.
Have those Judgments been Abstracted (recorded in deed records)as per that state’s legal procedures and statutory law?
If they have been abstracted in deed records, then those Js operate just as any other recorded subordinate lien such as a 2d or 3d DOT and if that’s the case, then yes a formal foreclosure of your deed of trust is necessary to eliminate all such subordinate liens.
If they’ve NOT been abstracted then a QCD to you would effectively work to get you back the title to the RE.
A title report would tell you instantly whether such abstracting/recording has been done.