Q: Can a portion of property be sold or granted while there’s a mortgage on the property?
My elderly parents own 2 lots in unicorporated Columbus county. They have a mortgage on the property. A neighbor built multiple structures that clearly encroached on my parent’s land. They told the neighbor this but the neighbor claimed my parents were wrong. To make sure, I had a survey done last year, 2021. This survey clearly proved that the neighbor was wrong which they then admitted. My parent’s verbally agreed to sell the portion of land to the neighbor for fair market value. The neighbor had a survey done and an agreement drawn up. They brought the agreement to my parents who they convinced to immediately sign and have notarized. My parents were then notified that they could not sell the portion of land because of the existing financial obligation. They told the neighbor the deal was off and they’d need to remove their structures though the neighbor submitted anyway. Online records now show the property as owned by the neighbor. Is this legal or a mistake?
A: There is nothing preventing the sale of a mortgaged property; it just frequently triggers a due on sale provision in the mortgage. Without seeing all the paperwork, I could not tell you if what was done was legal or not. My advice is to speak to a local lawyer who can pull all the files, review the paperwork, and give you more specific advice.
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