Wells Fargo refi’d a loan on my subject house without satisfying a judgment on the wife that was recorded a year before the refi. My first thought is that any judgment would encumber the property. If I short the loan, can I assume the judgment isn’t an issue, since it apparently wasn’t for Wells Fargo? I mean, if I can find the judgmetn online, wouldn’t the lender have caught it and insisted on a payoff if it mattered?
Yes my friend banks do make mistakes and overlook things like judgments.
I am not an attorney but I can almost assure you that if you short the property the title company issuing the title policy will find it and require a satisfaction.
If you do a short sale in most cases the bank will require the buyer to settle the lien. The lender usually will not pay it off as it is construed to be of financial benefit to the seller.
What I usually do is call the person holding the judgment and see if they will take a settlement. I explain the property is going to foreclosure and they will not get any money from the sale. They will still have an active judgment but nothing to hang it on.
If it is a large judgment and the lien holder does not want to negotiate the payoff you can ask how much he wants to release the subject property from the lien. This generally does not work but if it is a last ditch attempt to clean up the problem you can try it.