Removing a lein?

[Anonymous]

Good day all. My question may seem somewhat weird but here it goes. I live in Indiana, my wife and i seperated and eventually divorced. During that time i moved into military housing and she kept the house but didnt make payments. Apparently the house was only in my name. Anyways, it ended up being foreclosed on. Went through the sheriffs sale. Seven years later i try to buy a house and i am a week from closing and the title company says i have a lien on my name. 

Apparently, they sent a 1099-A to the address of where i lived at before the foreclosed house so i never recieved it. They are basically saying i now owe 164k. This is through Bank of America. I have called them several times to see about getting this removed but it has been like going to the circus. Depending on who i talk to they say i don't have a lein or i do. i was already approved until this fiasco.

I have hired an attorney but he seems to be getting no where and the communication with him sucks also. I just don't even know what my options are at this point. It is not on my credit report as i have done all i had to to get that cleaned up over the last few years.

Any ideas would be greatly appreciated. Thank you all in advance.

[LakeLife]

What a tough situation OP, and I truly feel for you.  I realize you're having trouble with your current attorney, but if it were me I'd fire him and get another that has better communication with you.  I hope you haven't put too much money into his services thus far.  I'm not sure anyone here can really help you, but I hope so.  

Good luck.  

[Anonymous]

Been going at it for like 6 months now. Haven't seemed to make up any ground. I believe the SOL is 10 years in Indiana to top it off. Which means i would have to suck it up for at least 3 more years and hope they dont look to update it again. I guess another option would be a BK but i have no more negative credit. That would be like shooting myself in the foot. And i am sure i wouldnt be able to do a 7 because i amke too much money. I hate my life sometimes.

[DaveInAZ]

Maybe I’m overly tied up on terminology but they don’t put liens on people, only on property. If there was a deficiency in the foreclosure - the property sold for less than amount owed - BoA would have gone to court to get a judgement against you. But you would have to been served a Summons for the court hearing, a letter wouldn’t have cut it, served by sheriff or certified mail signed for. Your attorney should have explained this to you.

[Anonymous]

You are correct. It is on the property. I was never served, as i said i moved out. Perhaps my ex signed for something but when i questioned her about she didnt recall signing for anything, of course that was 7 years ago though.

There was a deficiency in the foreclosure and that is why the title company is saying that their is a lien on me. I had been approved and i was basically in the final steps when the title company says they found it. So now they won't approve my loan until this is fixed. It might be on the property but its my name that showed up. I was looking at a completely different property.

[DaveInAZ]

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@Anonymous wrote:-A

You are correct. It is on the property. I was never served, as i said i moved out. Perhaps my ex signed for something but when i questioned her about she didnt recall signing for anything, of course that was 7 years ago though.

There was a deficiency in the foreclosure and that is why the title company is saying that their is a lien on me. I had been approved and i was basically in the final steps when the title company says they found it. So now they won't approve my loan until this is fixed. It might be on the property but its my name that showed up. I was looking at a completely different property.

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I overlooked you saying "they sent a 1099-A", but then I'm not a tax expert or an attorney, just someone trying to be helpful. I had to look it up: "On Form 1099-A, the lender reports the amount of the debt owed and the fair market value of the secured property as of the date of the acquisition or abandonment of the property." Basically when you are relieved of some or all of any debt, except in Bankruptcy, the IRS considers this taxable income that you need to report and pay tax on. So, this "lien" on you could be an IRA tax lien which you are liable for, and cannot be getten rid of either through Statute of Limitations on debt or bankruptcy - the goverment writes the rules and they make sure they get paid. While the the 1099-A was sent to an old address and you didn't receive it the IRS should have been contacting you if they did place a tax lien on you. Have you been filing personal tax returns every year since? If so they should have your current address to contact you about this. Have you been receiving tax refunds? If you owe the IRS a tax lien they won't give you a refund, they apply it against what you owe.

My best suggestion is you get the title company to give you a copy of whatever it is they say is a "lien on you", then make an appointment with your attorney and take the copy to him/her and ask what needs to done to fix it.

Good luck!

[CreditInspired]

Oh boy! What a PITA?

First, you need to go to the state/city/county courthouse where the property is located to find out for sure what’s going on. If there’s a lien, it will be there. You can also check online by going to the courthouse’s web portal and look under real estate (I think). It’s called something different in every state.

Let us know what you find.

[Anonymous]

As referenced above, it is not a lien, unless it’s a tax lien. Normal liens do not exist against people. It is a deficiency judgment or a tax lien.

But no matter what if your lender says it must be dealt with, if you intend to proceed with that lender, you’re gonna have to somehow resolve it.

Because judgments and liens do not show on credit reports anymore you may be able to find financing with another lender that doesn’t dig as deep, as this should not affect your scores.

[Anonymous]

Yes it was a defieciency judgement. Yes i do pay taxes every year and i do get a refund every year, so no issue there. As far as getting a new lender, the lender is not the one who dug deep, it was "found" through the title company, so i am assuming they would find anything else even if i switch lenders.

[DaveInAZ]

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@Anonymous wrote:

Yes it was a defieciency judgement. Yes i do pay taxes every year and i do get a refund every year, so no issue there. As far as getting a new lender, the lender is not the one who dug deep, it was "found" through the title company, so i am assuming they would find anything else even if i switch lenders.

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OK. I asked about tax refunds because if the IRS had placed a Tax Lien on you for that 1099-A they wouldn't give you income tax refunds, they would apply it against the tax lien. So that's good news, an IRS Tax Lien is pretty much impossible to fight.

Now, the deficiency judgement: Assuming you were still legally married to your Ex 7 years ago and she was served a Summons for the deficiency judgement hearing and signed it I don't think that was legally serving you, but that's something for an attorney to advise you on. If your attorney agrees you were not legally served you can fight to have the judgement voided on that basis, but that would take quite some time and legal expense. Frankly it doesn't sound like you will be able to close on your house and you should make other plans.

A deficiency judgement is subject to Statute of Limitations, unless the bank files to renew it - which since they have apparently never made any attempt to collect it is doubtful. But, here is the bad news: It appears the Statute Of Limitations for Judgements in Indiana is actually 20 years:

https://statelaws.findlaw.com/indiana-law/indiana-civil-statute-of-limitations-laws.html