Posted by Sara-NV on 6/14/05 10:45pm
Msg #44705

Affidavit as to Liens, Encumbrances, etc

This is a form I've only seen with Ditech/GMAC loan packages. I hate this form, so confusing. It says it must be completed in the borrower's own handwriting. They're supposed to list any liens and the creditors for such things as furnaces, air conditioners, swimming pools, etc. If a homeowner has taken out a loan for draperies or a new furnace, do those things get listed on this form? It's also a form that needs to be notarized. help...

Reply by HisHughness on 6/14/05 10:54pm
Msg #44709

That is a standard form. I had it on three closings within the past week.

Reply by Sara-NV on 6/14/05 10:55pm
Msg #44710

So how do you/they fill it out?

Reply by Ernest_CT on 6/15/05 1:22am
Msg #44752

Yup, these kinds of forms have been in a lot of the signings I've done.

The best advice I can offer is to keep things simple. Loan for draperies? No; that isn't a lien. A lien, sometimes called a mehanics lien, would have resulted from legal action taken against the borrower because of non-payment. If I were to buy a swimming pool (ho, ho, ho), then I'd probably sign a promisory note. If I failed to make payments, then the pool company would take me to court. If the pool company won, they would encumber my property with a lien. That lien would (probably!) prevent me from getting a loan without paying off the lien with some of the loan proceeds.

Keep the borrowers calm. The lender SHOULD already know if there are encumberances. If there are, they'll probably be listed elsewhere in the package. They may appear on the HUD as things to be paid off with the loan proceeds.

None of the preceeding should be consrtued as legal advice.

Reply by Sara-NV on 6/15/05 11:35am
Msg #44820

Thanks for your responses. I was confident that any kind of lien would have shown up on the title search or credit report. So in most cases, the borrowers should write the word "none" in each of those 4 blank spaces on the form?

Reply by Ernest_CT on 6/16/05 1:08am
Msg #45039

While I certainly wouldn't offer legal advice, writing "none" would be A Good Idea.

Reply by Art_MD on 6/15/05 10:04am
Msg #44788

Re: liens - several types/cause

In many states it's easy to file a lien against a property.
If you have a HOA and don't pay dues - they can file a lien for ~$10.
If you had a roof repaired and disputed the work and didn't make the final payment - again $10 and the roofer can file a lien. (workman's lien)
Don't pay state or fed taxes and lose in court. If you don't pay they file a lien. (tax lien)
If you lose a judgement in court and don't pay they can file a lien.

Art