In a prior Blog entry, I offered a “Question & Answer” format with regard to the impact of a money judgment on a real estate transaction. At this time, I would like to continue the dialogue, with some additional entries. Thank you.
- How long is a money judgment enforceable against a judgment debtor?
A money judgment is enforceable against a judgment debtor for a period of twenty (20) years. This enforcement period pertains to the personal liability of the judgment debtor. This is separate and apart from the time line that is applicable to the lien of a money judgment on real property.
2. How long is a money judgment a lien on real property?
A docketed money judgment is a lien on real property for a period of ten (10) years from the date of perfection of the judgment, unless renewed or extended. As to the mention of docketing and perfection in my within response, please refer to my earlier blog entry that discussed the distinction between docketing and perfection.
Please look for further Blog entries on this topic. In the interim, your comments and/or questions are welcome.
As title professionals, we frequently deal with money judgments, and the impact that they have on a real estate transaction. On a go forward basis, I will share with you some of the “Judgment 101” issues that arise, in the form of a “Question & Answer” scenario. Apropos to this segment, please consider the following:
Question: The abstract of title indicates the date when a judgment was “perfected”, and the date when a judgment was “docketed”. What does this mean?
Answer: The “perfection” date, is the date that the creditor is awarded the judgment by the Court. The “docketing” date, is the date that the judgment is entered in the judgment roll/book of the respective County Clerk’s Office.
Question: When is a judgment an actual lien against real property?
Answer: The docketing of a judgment in a county where the debtor owns real property, or later acquires real property, paves the way for the docketed judgment to become a lien against real property in that county.
Please look for future blog entries on this topic. In the interim, your questions and/or comments are welcome. Thank you…
When a federal tax lien is filed against real property, an additional layer of frustration impacts the closing process. In many instances, the validity of the lien, and/or the corresponding tax charges, are being challenged by the property owner. At the same time, even if a settlement is reached, the property owner may not have sufficient assets to satisfy the lien. In the absence of a release or satisfaction, there is the likelihood that the closing will not take place. Such an occurrence only worsens the financial standing of the property owner. In this scenario, the property owner may seek to obtain a “Certificate of Nonattachment”.
Ironically, there is no standard form available with regard to this process. Instead, the taxpayer is instructed to submit a computer generated request to the IRS office in which the lien was filed. In this regard, the taxpayer will need to provide very specific information, all of which can be found on the IRS website. To assist with this process, please go to www.irs.gov. At that point, you will follow the links to Publications 1024 and 4235. By following the instructions, one will improve their chance of obtaining the “Certificate of Nonattachment”. As a result, all involved may be able to gather at the closing table, and achieve a happy ending.
Although an inquiry that is more frequent when the economy is in distress, trying to locate a specific bank that is no longer operating under its original name can be a difficult task. In that regard, one may not know if the bank has merged with another bank, ceased to operate, or has been taken over by the government regulators.
One source can provide useful information in obtaining answers to these questions – www2.fdic.gov. Once logged on, you can follow useful links such as the “Bank Closing Information” tab, which will allow you to click on the “Failed Financial Institution Contact Search” tab. In addition, in the upper right hand corner you will find an area entitled “Advance Search”. If you type in the words “bank mergers”, you will be able to access further links and sources to enhance your search, and ultimately find out which entity has taken over the institution that you are concerned about.
Ideally, this information will provide some clear direction to a complex landscape.
In 2014, newly enacted legislation will require that all parties receiving a “Basic STAR Exemption” register with New York State in order to continue receiving the exemption. Those receiving the “Enhanced STAR Exemption” are not affected by the legislation.
There is no need to take any action at this time. The state, by mail, will contact all “Basic STAR Exemption” recipients regarding these changes.
The revised registration program is being implemented in order to address abuses of the system relating to inappropriate and/or fraudulent STAR exemptions. In that regard, penalties, sanctions and fees will be increased and/or introduced anew.
For additional information, please view www.tax.ny.gov and follow the link to the STAR program.
FIRPTA, also known as Foreign Investment in Real Property Tax Act, establishes a procedure for the collection of a withholding tax from the proceeds of a real estate sale by transferor non-resident aliens and alien corporations of certain interests in United States real property. The responsibility for withholding the tax from the proceeds of a sale rests with the transferee of the property.
Although the requirements of FIRPTA impact a real estate transaction, it is important to note that this is not a title issue. Furthermore, the title policy does not afford any coverage with regard to this matter. As such, the role of a title company is to provide helpful information only. In that regard, it is recommended that clients be referred to www.irs.gov in order to gain additional insight. The website contains useful links that will provide interested parties with instructions, forms and related materials.
By following the guidelines provided by the Internal Revenue Service, the transaction will appear a bit less “foreign”, and should make for a smooth closing.
As the real estate industry continues to improve, there will likely be an increase in clearance and underwriting issues. In that regard, the Mutual Indemnity Agreement may increasingly find its way into your transaction.
That said, many people are under the mistaken belief that a loan policy, by itself, will dispose of any title matter that is defined as a “covered defect” pursuant to the terms of the Mutual Indemnity Agreement. Please note that such is not the case. Only the presentation of a fee policy, in such an instance, will serve to resolve a title matter that is defined as a “covered defect” under the Mutual Indemnity Agreement.
In all other situations, additonal information/documentation is needed in order for your transaction to benefit from the Mutual Indemnity Agreement.