13
Aug 2014

NJ Title Insurance and personam tax foreclosures?

By admin

Can NJ Title Insurance be issued on a property whose ownership derives through in personam tax foreclosures?

Providing NJ Title Insurance in such a transaction involves increased risk and thus requires increased scrutiny.  A Chancery Abstract must be obtained anTax Liend reviewed for regularity.  All title and lienholders must be properly joined in the foreclosure action.  If the United States of America is sought to be divested, the property must be subjected to public (Sheriff’s) sale.  (If the United State’s interest is other than a Federal Tax Lien, we would have to obtain underwriter clearance.)

If the Final Judgment was entered less than one (1) year prior to the transaction for which insurance is requested, the following exceptions will appear on your NJ Title Insurance policy.

•    Consequences of the exercise of the right of redemption for a period of three months from entry of Final Judgment pursuant to N.J.S.A. 54:5-87.

•    Consequences of the re-opening or vacating of the Final Judgment for a period of one year from the entry of said Final Judgment pursuant to Rule 4:50-1 et seq.

•    Consequences of an attack on the estate or interest created by the final judgment dated (date of final judgment) recorded (date of recording of final judgment) in (recording information for final judgment) under the Federal Bankruptcy Law or any creditors’ rights law or state insolvency law.

In addition, the following requirement and exception will be included:

•    Proof is required that the owner whose interest was divested by the foreclosure of the Tax Sale Certificate is no longer in possession of the land being insured hereunder.

•    Rights of parties in possession and tenants in possession of subject premises protected by N.J.S.A. 2A:18.16, et seq., the New Jersey Tenant Anti-Eviction Statute.

Please be reminded that Tax Sale Certificates enjoy priority over other Tax Sale Certificates in inverse order; thus the holder of a more recent Tax Sale Certificate may successfully cut off an older Tax Sale Certificate in a foreclosure.

As always, feel free to address any questions to a member of our NJ Title Company.

About World Wide Land Transfer:

World Wide Land Transfer is a full service Settlement and Escrow Company also providing comprehensive title insurance services for all forms of real estate transactions ranging from a home purchase or refinance to the most complex commercial transaction.  World Wide Land Transfer started predominantly as a PA Title Company in 2004 but grew quickly and started issuing NJ Title Insurance, NY Title Insurance, MD Title Insurance, VA Title Insurance and FL Title Insurance. World Wide now covers most counties throughout the nation.

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