Q: I recorded a lien on a home for $400k for money I’d given that was not returned,foreclosure now,Iamserved as defend. Y?
A person I knew asked for a $400k investment with the promise of a return. Never materialized. Waited substantial amount of time before recording a lien for the $400k on his home in 2008. He would not answer the entire time so I waited. And now I was served papers last night and I am named as a defendant along with the person,his wife, also Bank of America is a defendant against the Plaintiff who is Wells Fargo. Is it only because I have a recorded lien? I have no other dealings with them. Am I going to now get my money back with this action?
In New York, subordinate lienholders (I am assuming your lien was perfected after the foreclosing lender and was subordinate to the foreclosing lender’s lien) are served in order to be put on notice.
A foreclosure action forecloses the rights of the property’s owner, as well as subordinate lienholders—so all are served to provide notice of the action and any legal consequences it may have.
While the senior foreclosing lender should take title free and clear of subordinated liens, those lienholders may have a right to surplus if there was one (as well as whatever other remedies you would maintain against the note obligor and other property he/she had).
A: I agree with Mr. Nelson as to why you are a defendant in this case, and what will result. However, as a matter of law, you cannot just record liens on property because you think you are owed money. Thus, I am not sure what you did, and how you did it. The problem is that there is a statute of limitations on suing for the loan proceeds, and you do not want to have done this wrong.
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