A lis pendens is notice of a pending lawsuit against a property owner. It is a public notice recorded in the same location where the title of real property has been recorded. It is usually filed in the county records. It lets the owner know that a lawsuit might later affect the title. A lis pendens is not a lien. It is only a lien when the lawsuit is successful, then it becomes a lien. This will in turn have an affect on the title.
Foreclosure is the enforcement of a lien. It is accomplished by legal proceedings in court as the result of nonpayment of a debt. Foreclosure terminates the rights of the owner and results in the public sale of the property used to repay the lien. If the sale does not bring enough money to pay the existing balance on the mortgage, the lender can file a claim for deficiency judgment.
A deed in lieu of foreclosure is an alternative to a foreclosure sale. A mortgagor who is in default can voluntarily deed a property to a lien holder in lieu of payment of a debt. It offers several advantages to the borrower and the lender. It releases the borrower from personal debt associated with the loan. The borrower also avoids public notoriety of a foreclosure proceeding. And lastly, it does not hurt the borrower’s credit as much as a foreclosure.
Seek advise of a real estate lawyer if you are involved in any of the above situations.
Tammy Hayes, Realtor, Sandals Realty, Punta Gorda, FL