Abstract Liens & Obligors

The Orange County Child Support Services tells us what happens if an escrow or title company, in this case Prominent Escrow, must do if they discover a judgment lien or abstract recorded against a child support obligor (read more here).

If a judgment lien or abstract is recorded against a child support obligor that is buying, selling or refinancing a piece of real property, the escrow/title company will request a “demand” from the creditor. The creditor is the agency or person who has caused the lien or abstract to be recorded.

A returned “demand” from the DCSS is nothing more than a legal statement as to how much is owed on the judgment. Obviously if the judgment lien or abstract shows up it is due to the obligor being in arrears on the required child support payments. The demand will be for the amount in arrears.

When the escrow or title company receives the returned “demand” statement form the DCSSthey will weigh the amount owed against any gain or money realized if the obligor is selling or refinancing a property. The full amount owed will be paid from any gain or money realized. The DCSS will then send a “matured installment” statement when the arrears have been paid but future child support is still owed. If the arrears owed has been paid in full, and there is no future support owed, then the DCSS will send a “release of lien.” The escrow company will record the necessary documents after the payment has been made.

If the obligor owes past due child support and is buying a piece of property the DCSS gives two possible scenarios. First, any obligor that is on a current wage assignment for past due support but has a good pay history may see the DCSS “subordinate its lien in favor of the first deed of trust on the new purchase.”

On the other hand, if the obligor is not on a current wage assignment and has a poor pay history, “then DCSS will demand that the debt be paid in whole or in part before a subordination will be tendered.”

http://www.css.ocgov.com/escrow/faq

Marketing