A lis pendens is a notice filed in a county’s land records that notifies the public and anyone searching the property that a lawsuit involving the property is still pending in the court.
Lis pendens comes from Latin, and it translates to "pending suit" or "pending litigation." When I was in underwriting, this was one of those terms that came across my desk more often than most people would guess. In real estate, it's a formal document that gets filed in the public land records of the county where a property sits. The filing puts everyone on notice that there's an active legal dispute connected to that specific parcel of land or home. It doesn't mean the property owner has done anything wrong, and it doesn't mean somebody has already won the case. It simply means a lawsuit is happening, and that lawsuit could change who owns the property or what rights will come with it.
Think of it like a flag on the property's record. Anyone who runs a title search sees it. That includes lenders, title companies, potential buyers, and real estate agents. The Consumer Financial Protection Bureau notes that title searches look for exactly these kinds of issues before a buyer gets too deep into a deal. A lis pendens is one of the first things that pops up.
Why is this important to you? When looking for a place to live, you may find one that appears to be a fantastic value but has a lis pendens on it. The whole picture is altered by that notice. Ignoring it and hoping it goes away is not an option. Before you have clean title, which is a prerequisite for any lender to authorize your loan, the legal matter must be settled.
Every state has lis pendens filings, although each jurisdiction has different regulations on who may file, when, and how. Lis pendens is a standard component of foreclosure procedures in some states. Others demand that before the notice can remain on file, the individual submitting must demonstrate that they have a genuine, valid claim. Since the development of property recording systems during the colonial era, American courts have relied on this idea, which dates back centuries in English common law. The first step to safeguarding yourself is to comprehend how the procedure operates in your state.
So how does a lis pendens end up on a property's record? It doesn't just appear out of nowhere. Someone has to take deliberate legal steps to get it on the record, and there's a specific process that plays out from start to finish.
A lis pendens may be filed by any party to a litigation that directly concerns a piece of real estate. This usually refers to the individual who initiated the action, or the plaintiff. The lender files it in a foreclosure lawsuit. If the family home is included in the property divide, either spouse may apply for divorce. One may be filed as part of a mechanics' lien case by a contractor who is due money for services done on a home. One may also be filed by a neighbor involved in a border dispute.
The crucial requirement is that the property itself must be involved in the litigation. A personal debt unrelated to real estate cannot be the subject of a lis pendens. Those are dismissed by courts, and filing a frivolous lis pendens may result in penalties in several states. Every day, our staff at AmeriSave observes how these filings impact the financing process, and the difference between a legitimate and dubious submission has a significant impact on how quickly a deal proceeds.
The person filing takes the lis pendens document to the county recorder's office (in some states, the county clerk's office) where the property is located. The document typically includes the names of the parties involved in the lawsuit, a legal description of the property, the case number, and the court where the lawsuit was filed. Filing fees vary by county but usually run between $15 and $75.
Once it's on record, constructive notice kicks in. Under this legal principle, everyone is presumed to know about the filing, even if they haven't personally read it. You can't buy the property and later claim you didn't know about the pending suit. The U.S. Department of Housing and Urban Development recommends that all home buyers get a thorough title search before closing, and that search reveals any lis pendens on record.
This is where things get complicated for a seller. Once a lis pendens is filed, the property becomes very hard to sell or refinance because most title companies won't issue a clean title insurance policy while the notice is active. Most lenders, including AmeriSave, need title insurance as a condition of the loan, so an unresolved lis pendens effectively freezes the property in place until the legal matter wraps up.
My husband and I were sitting at the kitchen table one weekend going over some project notes I'd brought home, and he asked me what kinds of situations actually lead to a lis pendens. It's a fair question, and the answer isn't always what people expect. The reasons behind the filing shape how long it'll take to resolve and how much risk a buyer takes on if they're interested in the property.
In states that use judicial foreclosure, where the lender goes through the court system to take the property back, a lis pendens is typically one of the first documents filed. It puts the homeowner and the public on notice that the foreclosure process has started. According to the Federal Reserve Bank of New York, mortgage and foreclosure activity remain key indicators of housing market health across the country. If you see a lis pendens tied to a foreclosure action, it usually means the homeowner fell behind on payments and the lender is pursuing the legal path to recover the property.
Foreclosure lis pendens filings can sit on a property for months or even years, depending on the state and how backed up the courts are. I was talking to a colleague recently about how drawn out some of these cases get, especially in states with mandatory mediation programs. Here in Kentucky, foreclosure is a judicial process, so lis pendens filings are part of the standard procedure. In nonjudicial foreclosure states like Texas or Georgia, the process moves faster and a lis pendens may not be required at all.
One spouse may file a lis pendens on the family home after a divorce if they both possess real estate. This precludes one spouse from selling or refinancing the property while the divorce is pending in court without the other's knowledge. It's a rather frequent protective measure. The filing is often handled by a family law lawyer as part of the larger divorce proceeding.
Since the property partition is typically addressed as part of the ultimate divorce settlement, these proceedings typically terminate faster than foreclosure procedures. The lis pendens is released after a judge signs the order.
Perhaps the buyer filed a case for particular performance, requesting the court to compel the sale, after the seller pulled out of the purchase agreement. In order to prevent the seller from selling the house to someone else while the lawsuit is still pending, the buyer files a lis pendens.
Lis pendens filings are also triggered by disputes over easements, mechanics' lien claims from underpaid contractors, and boundary conflicts between neighbors. Particularly prevalent are mechanics' liens. In order to prevent the homeowner from selling without paying the bill, a general contractor or roofer who was underpaid for a $15,000 job may file a lien and occasionally a lis pendens. For each third party seeing the property, each of these circumstances involves a unique timetable and degree of risk.
Although discovering a lis pendens on a property you wish to purchase may seem like a deal-breaker, it's not always the case. It does need you to take your time and complete more homework before proceeding.
Financing is most directly affected. Because the title is unclear, the majority of lenders will not accept a mortgage on a property with an active lis pendens. Like other lenders, AmeriSave requires proof that the borrower will be the sole, uncontested owner of the house. That guarantee is called into question by an ongoing lawsuit. A few lenders may be ready to work with you on an individual basis, but the procedure will often take longer and the terms will typically be less favorable.
The second obstacle is title insurance. A lis pendens is a public declaration of an ownership dispute, and title companies are in the business of protecting lenders and buyers against ownership issues. The majority of title insurers either decline to offer a policy or include particular exclusions that bar coverage for ongoing legal proceedings. This implies that you can lose the property and have no title insurance in the event that the seller's case is unsuccessful. Is it still possible to purchase without title insurance? Yes, in theory, but you would have to pay the entire amount in cash because no lender would fund a mortgage without it.
The timeline comes next. Legal conflicts take time, even if you're ready to assume the risk. A simple example could be finished in several months. A complicated one may take up to a year. The property is in limbo for the duration of that time. You won't be able to move in or close, and whatever money you've spent on appraisals, inspections, or legal fees will be locked up.
A lis pendens should be noted by your real estate agent early on, but don't rely on it. Prior to spending money on inspections or appraisals, always request a preliminary title check from your lender or title business. If the lis pendens proves to be a deal-breaker for your lender, that little action can save you hundreds of dollars in upfront expenses.
However, this is the opposite. Because the buyer pool is narrower and the seller is motivated, properties with a lis pendens occasionally sell for less. There may be genuine value in these circumstances if you have the time, money, and a skilled real estate lawyer. In a moment, we'll go over the math for it.
You feel helpless if someone files a lis pendens on your property. Although the notification makes selling very difficult, it doesn't actually stop you from selling. When a pending litigation appears on the title, the majority of bidders will leave, and those who don't will anticipate a substantial reduction.
Refinancing encounters the same obstacle. A refinance application is halted by a current lis pendens, and AmeriSave and other lenders do title searches as part of the loan approval procedure. You must settle the lis pendens before you may take money out of your equity or lock in a reduced rate.
Fortunately, there are legal choices available to property owners. You submit a request to expunge if the lis pendens was filed without a good reason, such as when someone filed it as a pressure tactic in a dispute that doesn't really impact the title to your property. Frivolous filings are taken seriously by the courts.
Direct negotiation with the person who filed the lis pendens is an additional choice. The lis pendens will disappear if the underlying dispute is resolved. That's sometimes quicker and less expensive than going to court.
Some buyers see lis pendens properties as opportunities. And honestly, they can be. I've seen colleagues help people close on properties like these, and when the numbers line up, the savings are real. But you need to go in with clear eyes and a solid plan.
To help you understand how the money works, let's go through a real-world example. Let's say you discover a $275,000 three-bedroom house with a lis pendens from a foreclosure proceeding. The neighborhood's comparable properties are selling for between $325,000 and $340,000. You settle on a price of $260,000 after negotiating with the motivated seller. In comparison to what you would pay for a comparable home with no problems, it may be $65,000 to $80,000 in built-in equity. Thus, there may be a significant upside.
However, how does the expense side appear? A real estate lawyer will analyze th matter, which can cost anywhere from $1,500 to $5,000 depending on how complicated it is. The cost of a sophisticated title search, which goes beyond a typical check, might range from $500 to $1,000. You may lose a rate lock or be required to pay extension fees if the deal takes longer than expected to finish. Additionally, if you're paying with cash while you wait for financing to be approved, that money is free and clear in a home that you do not yet own.
This kind of arrangement works mathematically. Even after adding $5,000 for additional legal and title fees to a $260,000 transaction, the total comes to $265,000, which is $60,000 less than the $325,000 comp. Your financed amount on the lis pendens property would be approximately $234,000 with a monthly principal and interest of about $1,518 at a 6.75% interest rate on a 30-year mortgage with a 10% down payment of $26,000. With a 10% down payment, the same loan for a $325,000 clean-title property would finance $292,500, meaning your monthly payment would be roughly $1,897. Each month, you save $379.
Take these actions if you choose to proceed with a lis pendens property. Prior to making an offer, consult a real estate lawyer. Obtain a thorough title search, not just a cursory one, that encompasses the property's whole history. To find out what is being alleged and by whom, read the actual legal papers. Request a reasonable timeframe for resolution from your lawyer. Find out if the seller is willing or able to pay to resolve the conflict. AmeriSave can assist you in understanding how your loan alternatives are impacted by the lis pendens and what financing will entail after the title is cleared.
Remember that your purchase agreement should include clauses that will shield you in the event that the case doesn't turn out the way you had hoped. If the lis pendens isn't settled by a certain date, a competent lawyer will include an escape clause that allows you to walk away and receive your earnest money back.
Depending on the circumstances, there are several ways to get a lis pendens off the record.
The most popular route is a court order. The court may order the removal of the lis pendens if the underlying litigation is dismissed, settled, or concluded by a judgment. The notice is removed from the property's record when the winning party, or both parties in a settlement, files a release with the county recorder.
Expungement operates in a different way. This is for circumstances in which the lis pendens should never have been filed in the first place. In a motion, the property owner requests that the notice be expunged by the court. After then, the individual who filed the lis pendens must demonstrate that their claim is legitimate. The court takes it away if they don't have one. A financial deterrent against frivolous filings is added when certain states require the filer to deposit a bail.
The easiest choice is voluntary withdrawal. Usually as part of a settlement or after choosing not to pursue the action, the individual who filed the lis pendens decides to release it on their own. The notice is cleared if they submit a release document to the county.
This raises the possibility of a discreet title action, which some individuals are unaware of. A quiet title lawsuit does just that if the lis pendens is entangled in a convoluted ownership issue and you need the court to definitively determine who owns the property. It's more costly and time-consuming than a straightforward expungement, but it's occasionally the only option for a fresh start when several parties have claims to the same property.
What is the duration of removal? It varies. Days pass before a voluntary release takes place. It could take several weeks for a judge to consider an expungement motion. It may take months or more to fully resolve a lawsuit. Regardless of the course, the property's title will become marketable after the lis pendens is removed from the record, and regular financing and sales will resume. Once the title is clear, AmeriSave's team guides you through the financing process.
Verifying that the release was truly recorded is one thing many individuals forget to do. Even if a case is settled, the lis pendens remains in the records if no paperwork is sent to the county. Prior to closing on a purchase or refinance, always have your lawyer or title company confirm that the release is documented.
A lis pendens is a warning sign, not a stop sign. It tells you there's a legal issue attached to a property, and that issue needs your full attention before you move forward. Do your homework. Hire an attorney. Get a thorough title search. If the numbers make sense and the risk is manageable, a lis pendens property is sometimes a smart buy. If the situation looks messy or the timeline is unclear, it's okay to walk away and put your money toward a cleaner deal. AmeriSave helps you explore your mortgage options whether you're buying a home with a clear title or navigating something more complicated.
Not exactly. A lis pendens indicates that a lawsuit concerning the property is still pending in court. One explanation could be foreclosure. Divorce processes, border disputes, contractor non-payment claims, and broken purchase contracts can all result in the filing of a lis pendens. Looking up the actual court case is the only way to determine why it is there. Your title search will locate the house when you try to buy it, and your lawyer can obtain the court documents to discover out what's happening.
Is it possible for me to obtain a mortgage on a home with a lis pendens?
quite challenging. Most lenders won't accept a mortgage on a property with a lis pendens since the title is unclear. To safeguard their investment, lenders demand a clear title and title insurance. When there is ongoing legal action against the property, title companies typically won't provide title insurance. If you need financing, you'll usually have to wait for the lis pendens to be resolved, but some cash purchasers can handle this. AmeriSave's lending alternatives might assist you after you are aware of the title.
Until the underlying case is settled or the court removes it, the lis pendens stays on the property record. For a quick settlement, that might only take a few weeks, but in a complicated case, it might take years. Certain states have expiration laws that cause a lis pendens to automatically dissolve if the filer does not renew it within a specific time frame. Your state's regulations can be investigated by your real estate lawyer. You can observe how these files are reflected in the purchasing process by looking at resources on title searches.
No, a lis pendens needs to be connected to a real property lawsuit. Saying something like "I don't like my neighbor" or "I want to stop a sale" won't suffice to file one. If someone files a lis pendens without a legitimate reason, the court may punish them by compelling them to pay the property owner's legal fees. A real estate attorney can assist you in getting a real estate lien removed if someone attempts to place one on your property without a valid lawsuit to support it.
Indeed, depending on the specifics, it might be. Due to the seller's incentive and the small number of buyers, properties with a lis pendens sometimes sell for less than market value. The reduction must be sufficient to cover the additional legal expenses, the delay, and the possibility that your ownership may be impacted by the litigation. Do the calculations with care. Even if a lis pendens property saves you $50,000 on the purchase price but requires you to pay $10,000 in legal fees and wait six months, it can still be worthwhile. See AmeriSave's resources on distressed properties for further advice.
It is a monetary claim on the property, such an outstanding mortgage or tax bill. A notice that a lawsuit affecting the property is pending is called a lis pendens. A lien enables a creditor to compel a sale in order to recoup their debt. Simply put, a lis pendens is a notice of impending legal action. Both can complicate a sale and appear on a title search. To help you know what to look for, find out more about what shows up in title searches.
Yes, in theory, but it's really challenging in real life. Every title check reveals a lis pendens, which deters the majority of lenders and buyers. If you are able to find a buyer who will proceed, they will likely demand a significant discount. Generally speaking, it is preferable to sell with a clear title after resolving the underlying litigation through settlement or legal action. You can prepare for the financial aspect of selling after the lis pendens is lifted by being aware of closing costs.
Depending on the time. The claim should be covered by your policy if you got title insurance before the lis pendens was filed. The title company will likely exclude the lis pendens from coverage if it was filed before the property was purchased. For this reason, conducting a thorough title search prior to closing is crucial. Title insurance is required by AmeriSave for all mortgages, and both the lender and you are protected by your coverage.
A title search works best. County land records are examined by title firms and real estate lawyers to see whether a property is subject to any liens, judgments, or lis pendens filings. Additionally, a lot of counties offer online databases where you can look for recordings by address or property owner name. Start your search for a house with ComeHome by AmeriSave, look through homes, and have your lender request a complete title search prior to closing.
The parties must submit a release or withdrawal of the lis pendens to the county recorder following the resolution of the litigation. This is not the norm in the majority of jurisdictions. "Someone needs to take the initiative and submit the documentation. Until such release is documented, the lis pendens will stay on the property's title and may continue to pose issues with sales and refinancing. Verifying that any previous lis pendens have been appropriately released should be on your home-buying checklist.
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