Legal Question in Real Estate Law in Florida
First Mortgage Paid Off by Holder of Second Mortgage
Property was in pre-foreclosure due to $$$ difficulties. Went to re-instate and found the whole mortgage was paid. Was informed that 2nd mortgage holder paid in full. No mortgage/note transfer or assigment took place. We received the Satisfaction and it was recorded as Paid in Full. Did not receive any papers from 2nd mort. holder. Now 7 months later we go to sell and he files a lis pendens for the money he paid plus interest because he states he is the note holder. Attorney in Florida states we can't do anything - must pay the money with interest to sell the property. Don't have a problem with the money, but the claiming of interest due as well. Can we pursue after the sale with any claim. Thanks!
2 Answers from Attorneys
Re: First Mortgage Paid Off by Holder of Second Mortgage
Based on the information you have provided, it appears you must pay the mortgage holder in order to get a satisfaction of mortgage and dissolve the lis pendens so you can transfer clean title to the buyer. What do you care who now owns the mortgage, you still have to pay it no matter who owns it. And as for the interest, most of the money paid on a mortgage during the first years constitutes interest, so what is the problem with paying the interest? The value of money over time equals interest, and the promissory note and mortgage compel you to pay it pursuant to its terms. You may want to try to negotiate a reduced lump sum settlement payment with the note and mortgage holder, but it is unlikely that the creditor will move much given your apparent weak legal position. Good luck.
Re: First Mortgage Paid Off by Holder of Second Mortgage
The holder of the mtg rises to the position of the original 1st mtg. After the sale, the original holder was unable to issue a binding satisfaction, because it no longer had any interest. It seems you will have to pay. The foregoing is based upon your statement of facts.
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