Dealing with OLD LIENS on mobile homes in Georgia
Hi everyone, I’m Brad, and I work with GAmobilehomebuyers.com and arborviewhomebuyers.com. I’m a real estate investor based in metro Atlanta, but I purchase properties all over Georgia, specializing in mobile and manufactured homes. Today, I’d like to discuss a common issue we frequently encounter – dealing with old liens on mobile homes.
Lien Release: A Crucial Step After Paying Off Your Mortgage
In many cases, these liens have already been paid off, but the release was never processed. In Georgia, there’s no statute of limitations on debt collection for personal property. However, please note that I’m not an attorney, so this is not legal advice.
When you purchase real property such as real estate, there is a statute of limitations to consider. Allow me to provide an example to illustrate this concept. Let’s say you bought a house 35 years ago, went through a 30-year mortgage, and paid it off 5 years ago. When a mortgage is fully paid off or any debt tied to a property is satisfied, the lender is required to file a lien release. This release, also known as a quitclaim release or a security deed release, is recorded in the property records to indicate that the loan has been fully repaid and that the lender no longer holds any claim to the property.
Many times, a loan that is held by a bank may be sold or the bank itself may go out of business and sell the loan to another party. If you have a mortgage, chances are high that your loan has been sold to a different entity at some point. These transfers of ownership happen from time to time.
Occasionally, in the process of these transfers, the final lender may fail to release the lien from the property. If you want to sell the property in the future, the title company will need to address this issue. However, there is a statute of limitations that comes into play after a certain amount of time has passed. The title company will review the situation and consider the fact that, even though the lien was never officially released from the property, the time limit for pursuing the debt has expired. After this time limit is reached, the lender cannot legally collect the debt, which means it is no longer a risk to the property’s title.
Microfiche
When it comes to personal property like a mobile home or a manufactured home, there is no statute of limitations. If the title has not been properly retired, old liens can remain on the title, even if the loan has been paid off. To address this, you may need to contact the original bank or financial institution to release the lien from the title. In some cases, these records may be stored on microfiche, a type of film-based document storage system used before digital imaging. This means they may need to search through old records to confirm that the loan has indeed been paid off.
Form T-4
In the state of Georgia, there is a form called Form T-4, which is a notice of satisfaction of security interest or lien holder’s affidavit. This form needs to be filled out to obtain replacement titles for a mobile home or a vehicle. The bank, lender, or lien holder must complete the form, providing the full legal name and other required information, and then have it notarized. This completed form must be attached to the application for the certificate of title (MV-1). This signifies that the bank is releasing the lien from the title, indicating to the Georgia Department of Revenue that titles can now be issued. However, in some cases, it can be challenging to find the right person at the bank to assist with this process, especially if the bank is out of business or the original lender has passed away.
If you find yourself in a complex situation that I described earlier, it’s best to seek advice from a contract law attorney. They can provide the assistance you need, especially if real estate is involved. If the issue is related to a mobile home without real estate involved, you may need to seek out a different type of attorney.
Sometimes, old liens that were not cleared from the title can cause problems when trying to obtain replacement titles. In these cases, the Department of Revenue will not issue a new title or allow transfers until the lien is paid off. This situation is not uncommon, and it’s important to address it properly.
Title Bond
If you’re unable to locate the person, you have the option to obtain a title bond.
To get a title bond, you can reach out to an insurance company. You can easily find a list of insurance companies that issue title bonds in Georgia by doing a quick Google search. There are several companies available, some of which operate locally. You can also contact your local insurance agent, as they may offer title bonds in-house or can connect you with someone who does.
Essentially, by paying a certain amount of money, you are securing a bond and purchasing an insurance policy. This policy ensures that if a creditor or something similar claims the mobile home in the future, the insurance company will cover the payment.
It’s important to note that obtaining a title bond can be quite expensive, often ranging from $800 to $1000 for a double wide. Once you acquire the title bond, you can submit it along with your MV-1 application, and the state will issue you a new title. The new title will indicate that a title bond has been secured. This way, anyone reviewing the title in the future can see that there’s a title bond attached to it and can access the necessary information to pursue the issuing company if needed.
Maybe one day they’ll change the statute of limitations on personal property, making all of this a moot point. For now, it’s quite a hassle to go through, and title bonds aren’t cheap. However, there is a way to get it done, but it will take some time and money to resolve. So, keep that in mind if you ever find yourself dealing with this.
Let’s Connect
I hope this video was helpful. I know it was kind of long, but there’s a lot of information to digest here.
I’m Brad with GAmobilehomebuyers.com and arborviewhomebuyers.com. If you want a cash offer on your mobile home or any property throughout Georgia, we’d love to make you a cash offer. We buy properties for cash all over Georgia. I’m also a licensed real estate agent, so if you want to list the property and get top dollar for it, I’d be happy to discuss that with you as well. Thanks for checking out this video. You can fill out a form on our website, and we’ll get in touch with you as soon as we receive it. Have a nice day!