In this week's Freedom Friday blog and email newsletter, I'm going to talk about something you need to know if your small business has anything to do with real estate. I've had many inquiries from people who are interested in buying rental properties, for example, or from some who wish to flip houses. I've also been involved as an attorney in certain types of litigation where this comes up, so this is an important topic that not many people ask about, but really need to know about. In today's Freedom Friday blog and email newsletter, I'm answering the question, “What is a Lis Pendens?”
“Lis pendens” is a fancy Latin legal term which literally means, “pending suit.” It is an official notice to the public that a lawsuit involving a claim on real property has been filed. It is common to see a “lis pendens” in a foreclosure case, when there are overdue HOA fees, sometimes in divorce and contested will cases, and in many quiet title suits. A “lis pendens” provides constructive notice or a warning that the actual ownership and/or title of real property, e.g. a home or a physical building or land, is in dispute and that a lawsuit is pending.
For example, in a foreclosure case, the bank or the creditor filing the lawsuit will file a lis pendens at the same time the lawsuit is filed. The lis pendens must be filed with both the court clerk and the county clerk. When the plaintiff files a lis pendens, the plaintiff is protecting its claim to title of the property pending the outcome of the litigation. A lis pendens can only be filed if a claim specifically related to the property is at stake, and it can only be lifted or released after the lawsuit is settled or resolved.
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