Posted by JohnBoy on July 13, 2004 at 22:03:07:
You can’t stop creditors from filing a lien when the property is still in the seller’s name. You can record a performance mortgage which would place you in front of any creditor liens or judgements. Then if a creditor files a lien and if the seller will not or can not take care of it, you can foreclose on the property having a performance mortgage and wipe the creditor’s lien out through foreclosure.
Once a property is deeded to a trust a creditor can’t just record a lien because they might “think” the debtor still owns it. The creditor would have to go through the court and have the debtor testify under oath if they are a beneficiary to any trust. If they are no longer a beneficiary of the trust they have nothing to go after. Even if the debtor was a beneficiary, they could only attach the debtor’s share of their interest in the trust.
Creditors can’t just go around attaching liens because they “think” you may still own a property. They could be sued for slander of title.