I can not sell my property because the title is clouded. Who is Liable?

Question

I bought some property a couple of years ago. I had a title search done and got a clear title opinion from my attorney. Now I am trying to borrow some money on this property and the title search came back with a pending lawsuit that the previous owners has against them from the neighbors. Who is liable on this the previous owners or the attorney or is the title clear since it is pending and no judgement has been rendered. State of Mississippi

I did not get title insurance

Answer 1

Well, you are going to end up spending some money here, because why you would buy property without title insurance, and/or why your mortgage company would allow you to buy property without title insurance is beyond me.

The attorney who gave you the Clear Title opinion clearly has some negligence problems. No one should give a clear title opinion unless they have actually done a search in due diligence on the title, and that would include a search of judgment records against the owners.

NOW: That being said, you indicated its a pending lawsuit. What is the status of the lawsuit? Has it gone to judgment? If so, then the title is definitely clear. If it has not, and the lawsuit was filed prior to the property being sold, then most likely then the a notice of Lis Pendens was filed, and this is what clouds the title.

You need to consult with an attorney in Mississippi, (NOT the only that gave you the clear title opinion) on your options, but you're going to end up spending some money here. Let this be a lesson: DO NOT buy real property without title insurance. For a referral to a Mississippi attorney, contact your local or state bar association.

Answer 2

Your title insurance should be checked first. Read your policy or have someone trained in the legal field check it.