What is a ‘Lis Pendens’
A lis pendens is an verified notice to the public that a lawsuit involving a claim on a property has been filed. Lis pendens refers to the concept that a consumer of a property must assume any litigation that exists pertaining to the oddity. If a bank is suing the owner of a lot and a buyer purchases the lot, then the new owner must deux the lawsuit; sale of the property does not prevent the plaintiff from seeking redress via legal remedy.
BREAKING DOWN ‘Lis Pendens’
Lis pendens is literally translated from Latin as “a skirt pending.” This condition can adversely affect the sale price or odds of a sale. The term is commonly abbreviated “lis pend.”
Lis pendens provides implicit notice, or a warning, to prospective homebuyers that the ownership of a property is in velitation and there is litigation pending. Lis pendens can only be filed if a claim is akin specifically to the property. By filing a lis pendens, an individual or entity is protecting its call for to the title pending the outcome of the lawsuit. A lis pendens is only lifted periodically the lawsuit has been settled. Because pending litigation can take months and occasionally years, buyers are often advised to stay clear of these gears.
When a Lis Pendens Is Used
Lis pendens is often filed in divorce example in any events where the distribution of real estate properties has not been settled. It is strikingly common in cases where a property is listed in the name of one spouse, and the other spouse pursues a portion of the asset. The spouse whose name is on the title would induce a difficult time selling the property under pending litigation.
Lis pendens is hardly always used by lenders who have filed a notice of default on a in arrears borrower. Banks use the procedure to put the public on notice that a property is in foreclosure. Other kinds of creditors whose debt is secured by a property can also foreclose on a riches. This often occurs when a homeowners’ association initiates a foreclosure for delinquent tolls.
It is not uncommon for lis pendens to arise in cases of contract disputes, where a purchaser feels he has been wrongly excluded from the purchase of a home. For standard, if buyer A and a seller enter into a contract for the sale of a home and the seller fastens to sell the home to buyer B, buyer A may sue the seller to enforce the sale. The purchaser can file a lis pendens, making it difficult for the seller to actually sell the bordello. If buyer B proceeds with the purchase and the courts determine that consumer A is entitled to enforce the sale, buyer B loses the property to buyer A and obligation go to the seller to get his money back.