real estate

Judgment lien on house for ex-lover's debt

Steve McLindenDear Real Estate Adviser,
What can you tell me about online home auction businesses? They seem to offer an I just found out that my ex-girlfriend, who used to live with me, had credit problems and got sued -- somehow resulting in a judgment lien on my property. I don't know where she is now or what I can do to remove this lien. I live in California and am surprised that something like this is possible.
-- Ernest B.

Dear Ernest,
Yes, all manner of things are possible in California. "There is science, logic, reason; there is thought verified by experience," wrote author Edward Abbey. "And then there is California."

Pardon the wee jab, my Golden State friends. It was mostly gratuitous. Courts and judges in all states, including California, have been signing off on an avalanche of judgment liens -- which are filed against homes when owners fail to pay a debt or debts -- sometimes targeting the more fiscally responsible remaining household member. Countless thousands, in fact, have been filed since the economy tanked a half decade ago. But in California, a lien placed against a property can stay in place for up to 10 years with an option for renewing for an additional 10. In other states (such as Florida, at five years), it's much less.

You'd better get ahead of this quickly. You typically have up to 180 days following notice of a judgment lien entry to appeal it. And as you probably know by now, such a lien "clouds" the title on your home, making it much harder to sell the place unless you first resolve the judgment. A big enough debt may even prompt a creditor to try to foreclose on you!

If you were kind enough to sign on as a co-creditor on one of your ex's debts such as a credit card, the lien may be legit. The same goes for other unpaid bills you two legally incurred, even if she was not on your deed. Now, if you and the ex happened to hold the house under a contractual tenant-in-common arrangement, the lien would encumber only whatever the percent of divided interest was in the home (probably, but not always, 50 percent). And if you and the ex held the place in a joint tenancy arrangement, then the lien may not hold up under appeal. Alas, you likely need a lawyer to sort this out.

You don't say what size this debt is. If it's in the thousands and turns out to be valid, you can try negotiating with the creditor and offering to settle for a small portion of the bill -- say, 25 percent. Some in your circumstances try claiming that they are left only with bankruptcy as an option, whereupon the creditor may agree to receive little instead of nothing. That doesn't always work, though.

Sometimes, creditors on shaky legal ground may try to claim you were in a common-law marriage and hence, all your debts were collective. It's worth noting here that if you two never expressed intent to marry, nor presented yourselves as a married couple, you probably weren't in a common-law marriage in California, no matter how long you lived together, family lawyers agree.

Again, though, I strongly suggest legal assistance if the debt was whopping and you can't afford to pay it. Regardless, this matter needs to be resolved before you can sell or refinance the house. Good luck!

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