Communication Is Key in Real Estate Law: Why?

by Isaac Benmergui, Esq on January 29, 2014

Paperwork, notification, tons of checks and balances – they all matter when it comes to real estate law and the sale of a home. If everyone’s not on the same page, havoc ensues, and in the legal industry, havoc is not something you want to deal with. Unfortunately, too, mistakes often occur, especially in the case of Old Republic National Title Insurance vs. Levasseur. Read on.Money Tree-2

This is a case about a particular lady by the name of Levasseur securing a home equity bank loan. That’s fair enough, especially when trying to finalize a second mortgage in the quiet town of Rowley, Massachusetts. What happens, though, when you end up selling the house anyway only to not notify the bank about it? There lies the problem.

In a case of mortgage fraud, this is simply a situation where a person basically took advantage of a situation to gain some extra income, an actual total of $124K. The bank never was notified, so they had no idea – however, the Appellant in this case neglected to pay all of that back, forcing the bank to foreclose on the property and transferring ownership to the one Old Republic National Title Insurance. Here, the legal battle begins.

Obviously, Old Republic filed a lawsuit against Levasseur for the debt pertaining to the equity line loan, but here’s the rub: Levasseur filed for bankruptcy! This threw a wrench into the proceedings, but Old Republic was quick to take action, seeking a determination on the question of whether or not the debt was actually dischargeable. Enter: the bankruptcy court, finding that it was not, ordering Levasseur that she must pay back that debt. And to think this all started with the simple neglect of letting the bank know that she sold her home….

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