What happens if a bank issues a loan on a property where there is already a lien in place?

Get Legal Help Today

Compare Quotes From Top Companies and Save

secured lock Secured with SHA-256 Encryption

What happens if a bank issues a loan on a property where there is already a lien in place?

Have lien, as per divorce, signed by superior court, 45K @12%, filed 12/09. Ex awarded the house and a cabin. I received a judgement against her for 45K and filed a lien on the house and cabin. She took out a 2nd on house for 37K in 04/10. My lien was not paid. Bank is still looking into this. Are they not required to pay the lien? Should they have not loaned money with the lien in place, without paying the lien? House tax value 226K, first 120K, lien 45K, and now 37k in 3rd place. How can I get my money, who will pay?

Asked on August 17, 2010 under Real Estate Law, Washington

Answers:

M.T.G., Member, New York Bar / FreeAdvice Contributing Attorney

Answered 13 years ago | Contributor

How the loan was obtained and the manner in which it was done matters as to the lien.  If someone is taking out additional funds without refinancing the entire mortgage, then most likely your lien would not be paid off.  The bank will look at the equity in the house to see if there is enough to cover the encumbrances (mortgages, liens, etc.).   Although it may not be prudent to have lent a 3rd mortgage it may not in any way be illegal.  I would do yourself a favor and double check that your line is properly filed.  Either the bank failed to do a title search or they missed it.  But you will want to know why they missed it to make sure that it does not happen again.   You may also want to consider another form of collection.


IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although AttorneyPages.com has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

Get Legal Help Today

Find the right lawyer for your legal issue.

secured lock Secured with SHA-256 Encryption