This is part 4 in a series describing different types of sellers and transactions in the Las Vegas Area market.
Lis Pendens is a title deficiency that prevents a home sale so I am going to call this a type of seller. More specifically, it is a seller contingency.
In some states, a Lis Pendens is part of the foreclosure process. Since Nevada is primarily a non-judicial state, this isn't the "normal" route of foreclosure.
Lis Pendens means "lawsuit pending" (Latin.) While there may be a Lis Pendens deficiency on title for many reasons - the most common is for possible owners that are not owners of record or on deed. A divorce situation is probably (no statistics available, so I believe) the most common reason why a Lis Pendens is filed. If one of the owners is not on the deed of a community property, this will stop the owner of record from selling it without the other party's permission or direction.
Pitfalls of a purchase that involves Lis Pendens:
- The Lis Pendens will more than likely have to be resolved in court which takes time.
- A trustee's deed will trump the Lis Pendens so if the home is in default, it could go to auction (get foreclosed upon.)
Current Lis Pendens Climate & Purchase Procedures and Variations from Typical Transactions:
The price, terms and conditions should be that near market value. If the seller or interested party that filed the Lis Pendens protests any part of the contract, the court may require the price, terms and conditions be altered.
Buyers must understand that even though the seller has signed off on the contract, their closing date, price or terms could be changed. Just reiterating the above paragraph! Don't order the moving van or give your landlord notice that you are moving until the court has approved the price, terms and conditions for the sale!
A Lis Pendens could take time. Since this is a seller contingency, this process could take time. It depends on how motivated the seller is and what the court schedules look like.
!!!If the sale is in regards to a divorce and one of the parties still occupy the residence, there could be issues in the end in regards to occupancy, what is and is not real property, etc. Hopefully your buyer's agent will prepare you emotionally for the outcome if there are some hiccups!
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**Las Vegas Area Sellers and Sales (Transaction) Categories: Lis Pendens (#4 in a series)