One huge reason homeowners are unable to buy and sell property are title defects which cause fights over lien priority. An experienced lawyer can help you work through lien priority disputes through quiet title actions, negotiations, or litigation.
Income Taxes: When you forget to pay your taxes, an IRS tax lien arises automatically. This lien stays until it is paid or until the tax assessment expires, which is 10 years. The tax lien lacks priority against listed classes of creditors until the Notice of Federal Tax Lien is filed. Holders of security interests, mechanic’s lien and judgment lien creditors have priority over federal tax liens if they are filed first.
State Taxes: State Tax Liens must be filed before IRS tax liens to have priority, even if the state lien arose automatically because the state taxes were unpaid.
IRS Tax Liens Eliminated:
- Certificate of Release where the tax is fully paid or compromised.
- Certificate of Discharge which only affects the specific property listed and does not affect taxpayer’s other property.
- Certificate of Subordination where the IRS can subordinate its lien in specific property if the IRS is paid the value of its interest or the IRS believes it will realize more money by issuing the subordination.
- Withdraw of the IRS lien can be due to a prematurely filed lien or a lien in violation of IRS procedures or where the taxpayer has entered into an installment agreement where the agreement provides for the withdraw of the lien.
Lis Pendens: The purpose of recording this document is to give claimants constructive notice of a potential lien. The filing of a lis pendens does not perfect a lien. Once determined by a court, the filing may result in a perfected lien.
A document that shows the transfer of a deed of trust from one person or entity to another is an assignment. Some common assignment errors are:
- Data Errors: Recording an incorrect book or page, or leaving blank the name of the assignee. You cannot fill in the blanks after the document has already been signed and notarized. Missing chain of assignment.
- Not Recording Assignments: Recording assignments is not required by law, but it does cause title issues. Spend the money and record your assignment.
- Not Having Uniformity in Recording: With more than 3,600 recording districts in the United States, you need to know the county recording requirements before creating a template. Many have different recording requirements, regulating font size, margins and signatures.
- MERS: Mortgage Electronic Registration Systems no longer commences legal actions in its name. As a result assignments must be prepared. There is a backlog. There are times when the MERS number is not on the assignment when it is recorded or the wrong number is attached to the loan or MERS forgot to deactivate the number after it has been assigned.
- Release Not Timely: Once the loan is paid off, a release is required to be recorded.