They say there is a lien on our house title....

[Murphyrulez]

I bought a house 2 years ago. We had a large mortgage, and a $10,000 second mortgage at the start. After about 8 months, I got a good deal and transfered the $10,000 mortgage to a credit card at like 1.9%. We refinanced the large part of it earlier this year.
Now I am trying to get a home equity loan, and the bank says that the original second mortgage company has a $10,000 lien on our title. I called them, they said no everything was paid off long ago. Everyone is willing to send me papers saying I don't owe any money, but who do I have to talk to to get the lien taken off the title? The city hall where I live?
Does anyone have any experience in this?

thanks

 

[slag]

Ask the question HERE. They are tons of help and pretty interesting to read also.

 

[Torghn]

The Title company should work that out for you, that's why they charge so much.

 

[Vic]

The original 2nd mortgage lender failed to reconvey their mortgage off the title of your property. In real estate, a reconveyance is the act of removing a mortgage, trust deed, or lien off the title of a piece of real property that was used as security in a loan. In legal terms, convey means to grant title or interest in. Reconvey means to give it back.
It is a very common action in real estate lending, generally handled by the mortgage lender who held the satisfied mortgage and the borrower's local recorders office.

In other words, your old 2nd mortgage co. should have handled this when you paid off their 2nd mortgage. If they insist on forcing you to do it, you will need a notarized recoveyance from them to take to your local county recorders office. Expect a recording fee in the neighborhood of $100 (varies widely by location).

 

[Vic]

Originally posted by: Torghn
The Title company should work that out for you, that's why they charge so much.

Correct. And generally, in a normal refinance, they would have in order to insure that the new lender had a clean title and clear lien positioning on the property. But he paid off the 2nd mortgage with a credit card, so no title company was involved in that transaction (which is probably why the old lender didn't do the reconveyance).

Bank Home Equity Lines of Credit (HELOC's) don't usually have full title policies, just limiteds which are much less costly, so they may not wish to perform the reconveyance for this specific transaction. Murphy could always call them and ask though.

 

[alkemyst]

You should be able to request a Satisfaction of Mortgage / Reconveyance of the property. Usually the bank does this automatically when you make your last payment.

These get recorded so they are of record. The bank should be able to fax them the document prior to recording as temporary proof.