Zombie Title

[Fireguy]

This is complicated...very complicated and I'm confused...very confused! Filed for Chapter 7 in 09 and walked from my home which was included in the BK in June of 2010. The property was not foreclosed on by Wells Fargo to the best of my knowledge as we never received any notices. Along the way we occasionally got HOA fee notices. My wife contacted them in 2012 and made them aware of the situation. They told us to disregard it and carry on.

Somewhere along the line the county sold the property at a tax sale because the taxes had not been paid. The property changed hands twice. Recently we began receiving notices from claim companies that we had $69000.00 being held for us by the county. So we inquired with the county and they said yes and we found out the property was still in our name. The past due taxes had been paid by the other parties at the tax sales. (Confused) Don't understand why the companies that bought the homes gave it back up unless the couldn't get a clear title on the property.

We were served a complaint by a Sheriffs deputy two weeks ago from the HOA stating we had 30 days to pay 2000.00 in back HOA fees or they were going to sue us. We contacted the county and the house is still in our name. We contacted Wells Fargo, our original mortgage company and they have no records. Yet they did state they would check into it and get back with us. We haven't heard anything.

I've heard about the zombie title deal and believe that is what we are dealing with currently. I have consulted two different attorneys about this that said it was way over their head and am awaiting another one to analyze our situation.

Anybody have any insight on this? Do we have the right to rent this house out to recoup current property taxes and HOA fees owed.

BTW, this property was put back in my name with a quitclaim deed by someone or some party. (Even more confused) Help!

[LadyInTheRed]

I am pretty sure you can reject a quitclaim deed. If you don't want the property, ask an attorney how you can refuse the quitclaim.

[brokehmowner]

I don't know if you are still around, but just in case: I heard of this happening in SC. It happened to one of my relative's in-laws but it was a bit more strange than your case. The bank never came after them when they stopped paying the mortgage. After they had saved enough they moved out to a rental but they were still never contacted. When they checked land records, there was no recorded mortgage. The house was deeded to them. It appears that the taxes and insurance were paid by the mortgage company until recently. There were back taxes owed. They paid the back taxes and moved back in the house. They really don't know what is going on. I think they do have an insurance issue but not sure what it is. They are saving quite a bit of money and are planning to get a lawyer to look into what they need to do to get this cleared up. Very bizarre.

[justbroke]

If there are title issues, always seek an attorney to review and do a title search. If there is no recorded mortgage or there is a cloud on the title, you can file a "quiet title" action in the local court.

As for "tax sales", these are usually just tax certificate sales. They pay the taxes and then they typically "must" hold the certificate for at least 2 years before applying for a tax deed. There are also other rules with respect to homesteaded properties (at least in Florida) which could make buying a tax certificate not the panacea of being able to obtain title to homes for just the past due tax.

I don't know the particular problem in this particular case, but either a title attorney or real estate attorney should be employed to get to the bottom of the mess.

[Fireguy]

What a wicked web we have been caught in on this deal. So now we have found out that the title deed was not sealed properly (lacks notary seal). Original documentation has become an issue. We have been through 4 attorneys but have finally found one that seems to understand our deal and is currently handling 2 others in similar situations. I have been advised by everyone (including Wells Fargo) to rent the house out to recoup my expenses. I drilled the locks out two days ago and put new locks on. The attorney seems to think we can sue for the house and may have a good chance of winning. I am tossed about that but Wells Fargo has become downright devious in their mortgage foreclosure processes. I have offered them to sign any document to ensure the title deed is in their name if they'll just pay the current taxes and HOA fees, yet they refuse. I'll continue updating everyone here how this goes down.

[justbroke]

Renting sounds like a good plan! I wish you the best and hope that you keep us up to date!

[Fireguy]

So here we are a few months later. As it stands currently our attorney has filed for a Declatory judgement for the property, excessive funds, attorneys fees and HOA fees. Well Fargo has 30 days to respond or we win the judgement by default. We have 10 more days to wait and see if they respond or not. Ultimately they found three major flaws with our deal. The original security deed was not notarized. 2nd, they had the property listed in the wrong county and last but not least, after we did a refinance a few years back a new security seed was not created. The minimum our attorney asked for was them to take responsibility for the property, pay past due taxes and HOS fees and our attorney fees. Still waiting to see how this goes and it still continues to be a nightmare....

[LadyInTheRed]

Good luck. I look forward to hearing how this works out.