Can former owners be sued in a property foreclosure?

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Can former owners be sued in a property foreclosure?

My parents inherited a house from grandpa 26 years ago. Prior to his death, grandpa was renting property. My parents quit-claimed the property to the tenant 25 years ago. Tenant at some point mortgaged the property andappears to now be in foreclosure. My parents received notice that they are being sued by the mortgage company (I think it might be one of the robo-signing mortgage companies). Can an actionable claim be brought against my parents since they quitclaimed the property 25 years ago? My fear is that their attorney may have dropped the ball and not recorded the quit-claim.

Asked on November 25, 2010 under Real Estate Law, Indiana

Answers:

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

Answered 11 years ago | Contributor

The tenant would not have been able to mortgage the property as an owner unless he had a deed on record.  Even a robo-signor would not be that negligent as to approve a mortgage that was not really secured by property.  But given the set of circumstances, I would most definitely have the title checked out by doing a title search and then seek help from a real estate attorney to inquire just why your parents are being sued in the foreclosure.  They may just be named for notice reasons as prior owners of the property (assuming again that the deed went from the estate to the to tenant or just to tenant from estate?).  There could be a "chain of title" issue and that is why they are being named.  But they should have it cleared up.  If they did not co-sign the mortgage then they will be ok in the end.  Good luck. 


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