Do Not Ignore Old Deeds, Mortgages, and Trusts
Many property owners may be operating under the belief that old mortgages, deeds of trust, and other documents that provide a security interest in real property to secure a debt will disappear over time. While this is somewhat true, it is not always the best idea to ignore and hope they’ll disappear. Section 882.020 of the California Civil Code clarifies the situation by stating, “[i]f the final maturity date or the last date fixed for payment of the debt or performance of the obligation is ascertainable from the recorded evidence of indebtedness, ten years after that date.”
If the recorded mortgage, deed of trust, or other security document has a maturity date or a date of final payment, this lien will expire ten years later. However, the maturity date or last payment date must appear on the record. If there is no date, Civil Code § 882.020(a)(2) applies, which states in part:
If the final maturity date or the last date fixed for payment of the debt or performance of the obligation is not ascertainable from the recorded evidence of indebtedness, or if there is no final maturity date or last date fixed for payment of the debt or performance of the obligation, 60 years after the date the instrument that created the security interest was recorded.
A lien issued by a registered mortgage or deed of trust that does not specify a final payment or maturity date, for example, does not expire until 60 years after the document was recorded. If your client cannot wait 60 years, a quiet title action may be the best option.
A quiet title action is brought to establish title to real property and clear it of any adverse claims or interests in the property. (Code of Civil Procedure sections 760.010 to 764.080.) A quiet title action is started by filing a Verified Complaint to Quiet Title with the court in the county where the property is situated and then registering a notice of the case’s proceeding, or lis pendens, on the subject real property. Section 761.020 of the Code of Civil Procedure provides all of the facts that must be included in the Verified Complaint to Quiet Title.
Code of Civil Procedure section 764.010 provides that at the quiet title hearing, “the court shall examine into and determine the plaintiff’s title against the claims of all the defendants.” This section continues, “the court shall not enter judgment by default but shall in all cases require evidence of plaintiff’s title and hear such evidence as may be offered to respect the claims of any of the defendants, other than claims the validity of which is admitted by the plaintiff in the complaint.” In short, the Court holds a mini-trial to assess the plaintiff’s title vs. the listed defendants’ claims, and then “renders judgment in accordance with the evidence and the law.” (Section 764.010 of the Code of Civil Procedure)
While time does not always eradicate some recorded liens on real estate, in some cases, a quiet title action may be the best option. If you’ve never filed a civil action before, start with section 760.010, et seq. of the Civil Code of Procedure.