Posted by GL(ON) on January 07, 2003 at 11:42:41:
That’s right. I assumed there was no such because they wouldn’t let something like this happen. But if they did they are responsible.
Seller never paid his debt - Posted by Jerry
Posted by Jerry on January 07, 2003 at 01:56:26:
I need to know if someone knows what to do when a seller promises a vendor he will pay a debt before escrow closes and then never pays. The vendor in turn tries to collect his money from the new owner of the property. Is this a legal thing? Can someone collect a debt from you because the previous owner never paid him?
Profit from your problem… - Posted by Anthony - OH
Posted by Anthony - OH on January 08, 2003 at 17:04:06:
You could buy the lien from the lienholder at a discount and THEN collect from whomever you were going to hold responsible… The difference = profit. Joe Kaiser has a book/course on this very topic.
This is why you need a lawyer/title co. - Posted by GL(ON)
Posted by GL(ON) on January 07, 2003 at 09:32:10:
This bill should have been settled at closing, as part of the closing costs. The vendor should have furnished a receipted bill, otherwise your lawyer would have held back enough cash to pay it, and only released that money when he saw the bill was paid.
It is possible that an old bill will create a lien on the property but you should make sure before you panic.
Even if it does, all is not lost. You can still pay the bill and recover the money from the vendor or simply make him pay the bill.
If you owe the vendor any money such as a second mortgage etc. then it’s child’s play. Simply hold back the money from what you owe him.
Home improvement costs… - Posted by JT-IN
Posted by JT-IN on January 07, 2003 at 07:30:28:
Jerry:
If that Vendor happened to provide repairs or home improvements on the property in question, then Yes, they can come back… usually within 60 days (this time limit varies from state to state), and assess a “Mechanics Lien” against the property. When you closed on the property, usually the Seller signs an affidavit saying that no work has been done in the last 60 days, that has NOT been paid for… This specifically relates to anything that could be construed as an unpaid repair/replacement, in which a ML can be filed.
Likewise, certain unpaid utilites can run with the property, but his varies widely also.
If you had Title Insurance on the purchase it will generally insure you against any of the liens that you may be concerned about here. You do not say whether you are buying creatively or in fee simple, so you may or may not have an insured title.
You should contact the Escrow Company and enlighten them as to anything that you are specifically concerned about, on the lack of paying the Vendor. Allow them to do their job in this situation, providing you bought the Title Ins…
JT-IN
if vendor worked on house - Posted by michaela-ATL
Posted by michaela-ATL on January 07, 2003 at 07:28:57:
then he would have 90 days after finishing the job to put a mechanic’s lien on the property. You would have title insurance, hopefully, that will take care of it and go after the seller.
If this is a debt unrelated to the house, then he should have any recourse against you, i think
michaela
Caveat: exercise caution - Posted by John Merchant
Posted by John Merchant on January 07, 2003 at 12:08:05:
“If you owe the vendor any money such as a second mortgage etc. then it’s child’s play. Simply hold back the money from what you owe him”
This is very good advice IF (BIG IF!) the purchase and sales agreement very clearly and succinctly spelled out that seller was going to clear these debts. If it did, then withhold as advised; if it’s not all that clear, then you’d probably be inviting a lawsuit by the Seller for any moneys withheld.
Possible liability to closing agent - Posted by John Merchant
Posted by John Merchant on January 07, 2003 at 10:45:23:
With a professional closing agent, such as a practicing lawyer, or title company, it’s their job to make sure ALL ducks are in order before disbursing funds; so if the deal was professionally closed, the closing agent might be liable to you for any omissions or screwups caused by them.
oops, meant ‘shouldn’t’ nt - Posted by michaela-ATL
Posted by michaela-ATL on January 07, 2003 at 07:32:44:
…