A zombie title or zombie property exists when a person mistakenly believes that they no longer have title to a property, but in reality they still have legal ownership of the property. This usually occurs in connection with a foreclosure proceeding.
For instance, if a homeowner cannot keep up with mortgage payments, the lender will likely foreclose on the home. In some cases, the foreclosure may begin partially, but later on the proceedings are dismissed. Here, the borrower still retains title, but they may have moved out of the home already. What results is that the property becomes vacant while the person’s name is still associated with the property. This can lead to other legal issues and have a negative impact on the property and the surrounding community.
Zombie titles result because lenders generally are not obligated to inform borrowers if they have dismissed or cancelled a foreclosure proceeding. Thus, the homeowner may have long moved out of the home before realizing that their name is still on the property. In many cases, the homeowner has actually relocated to another state without being aware that they technically still own the property. This “zombie” state of the property being unoccupied can go on for several months and even years.
Thus, zombie titles typically result because the homeowner has left in a hurry and has failed to follow through on the foreclosure proceeding. Also, banks can often repossess the home after a certain period. However, many banks or mortgage lenders choose not to repossess the property, especially if it has fallen into serious decay or disrepair.
A house with a zombie title can essentially become like an abandoned property. The owner may never return there, and the place can be left unattended for long periods of time. This can lead to legal issues such as:
- Damage to the home
- Unpaid property tax issues
- Public nuisance issues, as zombie properties often develop pest problems
- Crime issues (zombie properties can sometimes be taken over by squatters or can become sites of gang/criminal activity)
- Adverse possession issues
Thus, it is important that a homeowner follow up on any foreclosure proceedings to ensure that the process has been finalized and their name is released from the title. Zombie title issues can lead to lawsuits for damages, and may also lead to violations and citations from city/county regulatory authorities.
Zombie titles can often involve a whole host of different legal issues. You may need to hire a real estate lawyer in your area if you need assistance with mortgages, foreclosures, or a zombie title issue. Your lawyer can explain your rights and assist you with any legal issues you may be facing. Also, if you need to attend a court meeting or file a lawsuit, your attorney can provide representation as well.