Can a loan company put a lien on my home regarding a loan that was defaulted on by another who has no rights to my home?

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Can a loan company put a lien on my home regarding a loan that was defaulted on by another who has no rights to my home?

I own a home. My mother has pulled a personal loan on herself even she has no property, no income, only receives social security disability. She got a loan to have a pool built in my home but stopped paying on it. She has title or anything to my house.

Asked on July 1, 2013 under Real Estate Law, California

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 8 years ago | Contributor

Legally, someone who has no ownership interest in property cannot create or give someone else a security interest in that property; and person's A property cannot be liened for person B's default. So from what you write, it would normally appear there is no basis for lien on your property. An issue may be, however, that the loan company may reasonably believe that if your mother used the loan to build a pool in this house, that she must be an owner of it, and you'd have to prove to the contrary; and/or your mother may have committed fraud and represented that she was an owner (and therefore could encumber the property) to qualify for  the loan. As an additional complication, the law sometimes allows what's called "equitable liens," which means the creation of a lien to avoid blatant unfairness, even if ostensibly, there should be no lien. If you did not object and allowed your mother to pay for/build a pool in your home, the law might consider you the beneficiary of the loan and therefore consider it equitable to allow  the imposition of a lien. This is a complicated situation, and one which could involve having to press charges against your mother, if she misrepresented or lied about having an ownership interest in your home, to resolve; you should consult with an attorney in detail.


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