He also stopped paying the mortgage, taxes and utilities. White moved out, leaving the property vacant. They slapped a fine or issued a permit violation on the property, then scheduled regular inspections to verify that the issue was being resolved, during which time the fine continued to accrue interest. The city found out that the construction took place without a city permit and labeled the property as an unsafe living structure. White, rebuilt his house without a city permit and took out a construction mortgage that you are planning to buy as a note investor. In this example, I’ll show you how a city puts a fine against a property, which then could lead to demolition.Ī homeowner, Mr. If not resolved within the allotted timeframe, municipal liens may also cause the property to be scheduled for demolition. Typically, the department responsible for keeping these records is called the Code and Compliance Department or the Permit Department. Most townships or cities have departments that keep permit and code violations records for all properties within the city/township limits, and that’s where many municipal liens are found. This means that, in the case of a mortgage foreclosure, municipal liens will survive and need to be paid off by the property owner or lender.įair to mention, not all liens are recorded in the county recorder’s office where the property is located.
Municipal liens are considered a superior lien, and always have a higher position than the mortgage. City or township liens that are outstanding against the property are called municipal liens.
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