Removal of Lien is Buyer's Responsibility
Ask the Real Estate Lawyer: Real Estate Law Q&A
REM #LAW 719
By Ilyce R. Glink and Samuel J. Tamkin
Summary: A reader recently sold her home but the lien has not been filed. Ilyce and Sam explain that the seller should primarily be concerned that the mortgage company has received the payment. The lien is more of concern to the buyer and frequently takes longer to process.
Q: We recently sold our home in Maryland. The buyer was also the title agent.
The house went to closing eight days ago and the existing mortgages are still
not showing as "paid-off." The buyer/title agent claims that she has
30 days to satisfy these liens.
We simply want to see that they are gone so that we can move on. It seems to me that these should have been satisfied immediately. Is there a rule about this?
A: When you sell a home, the closing agent pays the lender off either by wire transfer the day of the closing or by wire transfer or overnight payment the next business day following your closing.
If your closing agent paid your lender but has not filed the paperwork to release the lien, don’t worry too much. If the closing agent didn’t pay off your lender, you should yell and scream as loudly as possible!
If your loan is paid off, the paperwork to release the lien will follow. Some lenders take a longer time than others to issue the paperwork to release the lien. Some lenders forget to send any paperwork and the liens stay on the old properties.
From your buyer’s perspective, she would want the lien released. From your perspective, if the loan was paid off, you should be fine.
Contact your old lender to make sure that your loan was paid in full. The lender should then process the paperwork to send you the cancelled note and mortgage. Once you have these documents, you know that the old debt has been paid and cancelled.
The lien on your old home should be released in time, but that will be less
of a concern to you and more of a concern to the buyer. If you have already
received the cancelled note and mortgage, relax and let the title agent get
the paperwork together and get it recorded in due time.
Samuel J. Tamkin is a Chicago-based real estate attorney. Ilyce R. Glink’s latest book is 50 Simple Steps You Can Take To Sell Your Home Faster and For More Money In Any Market. If you have questions for them, write: Real Estate Matters Syndicate, PO Box 366, Glencoe, IL 60022 or contact them through Ilyce’s website www.thinkglink.com
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