What Is a Lis Pendens?
Let me explain what a lis pendens is: it's an official notice to the public that a lawsuit involving a claim on a property has been filed. You need to know that lis pendens ties into the idea that if you're buying a property, you have to take on any existing litigation related to it.
For instance, if a bank is suing the owner of a lot and you buy it anyway, you as the new owner inherit the lawsuit's responsibilities; the sale doesn't stop the plaintiff from pursuing their case through the courts. This can create a contingent liability for you.
Key Takeaways
Here's what you should remember: a lis pendens is an official, public notice that a property has a pending lawsuit or claim attached to it. It can only be filed if the claim is specifically related to the property, but most laws require that the property owner assumes any litigation associated with it.
You'll see lis pendens commonly in divorce cases where spouses are dividing assets or in foreclosures after a borrower defaults on a mortgage.
How Lis Pendens Work
Lis pendens translates from Latin as 'suit pending.' This status can hurt the sale price or even prevent a sale because pending litigation is usually bad news for the owner. We often abbreviate it as 'lis pend.'
It gives constructive notice—a warning—to potential buyers that the property's ownership is in dispute with litigation pending. Remember, lis pendens can only be filed for claims directly related to the property. By filing it, you're protecting your claim to the title until the lawsuit ends.
Fast Fact
A lis pendens gets lifted only once the lawsuit is settled. Since litigation can drag on for months or years, I advise you to avoid these properties if you're buying.
When a Lis Pendens Is Used
You can use a lis pendens anytime there's a dispute over real property, but it's most common in three situations.
Divorce
In divorces, a lis pendens is often filed when the distribution of real estate isn't settled yet. It's especially common if the property is in one spouse's name and the other wants a share. The spouse on the title will struggle to sell under pending litigation.
Mortgage Default/Foreclosure
Lenders almost always use lis pendens when they've filed a notice of default on a delinquent borrower. Banks do this to inform the public that the property is in foreclosure. Other creditors with secured debt on the property can also foreclose.
Contract Disputes
Lis pendens often comes up in contract disputes, like when a buyer thinks they've been unfairly cut out of purchasing a home. Say buyer A contracts with a seller, but the seller sells to buyer B instead—buyer A can sue to enforce the sale.
After filing the lawsuit, buyer A can file a lis pendens, making it hard for the seller to sell. If buyer B buys anyway and the court sides with buyer A, buyer B loses the property and has to recover money from the seller.
Important Note
In some states, homeowners associations can place liens on your home for unpaid fees or covenant violations. Depending on your state's laws, an HOA can file a claim and a lis pendens, which makes selling difficult for you.
How to File a Lis Pendens
You can only file a lis pendens if there's a pending action, and it must involve real property like land or buildings. If not, it can be expunged.
Filing varies by state, but generally, you first file a lawsuit with the county clerk while the suit is pending. Then, record the lis pendens in the county land records to attach it to the title. This filing usually serves as notice of the dispute, but serving requirements differ by state.
Since requirements vary, contact a real estate lawyer in your area to check if you need to file one and how to serve it. You could draft it yourself using online info, but it's complex with specific wording—one mistake, and it's expunged. Better to have an attorney prepare it. If you can't afford one, look for public assistance programs.
Frequently Asked Questions
What is the purpose of lis pendens? It's a legal way to notify anyone interested in a property that there's a claim and pending lawsuit against it. This matters because it warns potential buyers of another party's claim—if they win, you could lose the property or face the claim.
What does discharge of lis pendens mean? It means your property no longer has a claim or lawsuit against it.
Who issues lis pendens? Anyone with a believed claim on a property can file it with the county Clerk of Court, but there must be a pending lawsuit for validity.
What does 'lis' mean in law? 'Lis' translates from Latin as suit or lawsuit, and 'pendens' means pending, so lis pendens is a pending lawsuit.
The Bottom Line
Lis pendens is a notice that a property has a claim backed by a pending lawsuit. You file it with the county Clerk of Court and record it in real estate records.
A lawsuit must be pending first. Anyone with an interest can draft and file it, but due to its complexity and specific language, hire a local real estate attorney to handle it.
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