Lis Pendens and Real Estate
The Lis Pendens And Real Estate
Lis Pendens is latin for “suit pending”. If a Notice Of Lis Pendens is recorded at the local county recorder on property it means there is a law suit pending on that property.
The notice secures any interest the plaintiff in the lawsuit may be awarded in the property. Once recorded it will be difficult to sell a property without first clearing the notice. Title companies will not close transactions with a notice recorded on the property. The notice does not legally stop the sell of property but anyone purchasing would be subject to the lawsuit referred to.
Anyone can record a Notice and many are not legitimate. To remove a notice on your property you need to file an action in court to have it removed. The judge will determine if the notice is legitimate and either remove or uphold it.
How a Lis Pendens Affects Sellers
This notice notifies land owners there is, or soon will be, a lawsuit which involves them, their land or both. The lawsuit could be anything from a public condemnation of property to a action to collect child support.
This type of notice is relatively rare but does happen. When it does it makes it nearly impossible to sell land until the lawsuit it represents is resolved. Some Notices are are not legitimate and can be removed by a court action.
How a Lis Pendens Affects Buyers
If a notice is recorded on property you are considering purchasing, DON’T!. You can wait and see if the seller is able to clear up the lawsuit but do not purchase until the notice is officially removed from the property, as determined by the title company.
Who Can File this type of Lien
Anyone can file this notice for any reason. Sometimes it is recorded to stop a property from being sold or as a vendetta against the seller. If there is no legitimate lawsuit behind the notice it can be removed by a court and the seller can ask for damages.
Reasons For Filing it on Utah Real Estate
Creditors often record them as they prepare a law suit to collect overdue debts from the real property owners. Government agencies or public utilities that plan on condemning (taking) the property for public purposes may also record a notice. They are recorded in a wrongful death suit against the real property owners.
Any attempt to collect money from the land owners or to condemn the property can result in this notice being recorded.
Affect On Selling Land
The notice will stop the sell of real estate. It is legal to sell real estate with this notice recorded against it, however a title company will not insure and most buyers will not buy real estate in this condition.
A Notice of Lis Pendens is a notice that someone is filing a lawsuit that will affect the property upon which it is recorded. The notice needs to be released before the property can be sold. Never buy land until it is released.