Legal Question in Real Estate Law in California
Thanks Mr. Whipple & Mr McCormick for your quick responses.
There are 3 trust deeds on a california home taken out between 1982-85.
With one the owner is believed dead - no paperwork to prove repaid, but the word of the original debtor before death, that it was paid off.
With another the individual who owned the complany that has the deed went bankrupt - he refused to sign anything on the adivce of his lawyer in spite of proof of repayment
and with the last, the corp who owned the deed - and never gave cash/goods/services - was purchased by another company. the lean was signed out of fear - per debtor who is now deceased - as an "insurance" policy for the original company.
The owner wishes to sell the house free and clear
The owner of the house is the spouse of the original debter
What can be done to have the deeds taken off the house.
Can these deeds have expired
Is there a way to expunge the deeds off the california home by using proper paperwork given the circumstances noted above
Can a bond be taken out prior to the sale to allow all proceeds of the sale to go to owner
Thank You
2 Answers from Attorneys
Deeds of trust, I'm afraid, have no expiration. And to add bad news, each of your deeds of trust in question presents a nearly text-book law school test question because it presents so many issues. The good news is that there are legal procedures for resolving each of them. The last bit of bad news is that they are not simple and may require court proceedings.
The only place to start is hiring an attorney. There is just no way around it. Each of the three situations is WAY to complex to try to sort out on your own. A good attorney will review the documentation you have, an contact the lien holders in a knowledgeable way to try to get them to release the liens. If any of them refuse, however, court proceedings will have to be filed to get the deeds of trust expunged.
You can try to find a title insurance company that will "insure around" these liens. But having worked for the top title insurance companies in the nation, I wouldn't bet on it. Your only real option is to get an attorney working on this, and the sooner the better before even more witnesses die and documentation becomes unavialable.
Let me know if I can be of further assistance.
I agree with Mr. McCormick that each of the three deeds of trust you describe have certain problems, each with their own solution.
Deeds of trust do not expire, but there is a statute of limitations on them. California has what is known as the Marketable Record Title Act (MRTA). Under the MRTA, a deed of trust is not enforceable 10 years after maturity date, if the maturity date is ascertainable from recorded documents, or 60 years after the deed of trust was recorded. In my experience, title companies are still reluctant to handle a transaction with an ancient deed of trust or mortgage, even when that statute is pointed out to them.
There is a statutory procedure to demand a "reconveyance" which clears the cloud of a deed of trust. That procedure can be used for a deed of trust where you have clear proof that the underlying obligation either does not exist, or has been satisfied. There are penalties in the statutory procedure, and you should be aware that the courts have held that a short, one (1) year statute of limitations applies to the procedure.
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