What is real estate lis pendens · Investor guide

What is real estate lis pendens? Meaning, effects and investor opportunities

So what is real estate lis pendens, and why should a buyer care?

In plain English, it is a public notice that a lawsuit involving the property is pending. This guide explains what it means, how it affects title and sales, how it often signals foreclosure and how investors can use it fairly.

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What is real estate lis pendens in plain English?

Lis pendens is Latin for “suit pending.” In real estate, it is a notice recorded in the county land records that warns anyone interested in a property that a lawsuit could affect its title or ownership.

Anyone who buys the property while the notice is active generally takes it subject to the outcome of that case.

In short: a lis pendens does not mean the owner lost the property. It means a court case is open, and its result could change who owns the property or what is owed on it.

Common causes

What causes a lis pendens notice?

In practice, several types of lawsuits can lead to a lis pendens. The most common include:

ForeclosureIn many states, a lender records a lis pendens when it files a judicial foreclosure, usually after the borrower falls months behind on payments.See lis pendens leads

Unpaid HOA feesHomeowners associations may sue over large unpaid dues and record a notice against the home.Look up owners

Divorce disputesWhen spouses fight over a shared home, a lis pendens can protect one spouse’s claim.See divorce leads

Title and contract disputesBoundary fights, unpaid contractors or a buyer suing to enforce a sale contract can all trigger a notice.See verified leads

Effects

How a lis pendens affects title and sales

In short, a lis pendens clouds the title. As a result, most title companies won’t insure a sale and most lenders won’t lend until the case is resolved or the notice is released.

Hard to sellLegally, an owner can still sell; but buyers take the risk of the lawsuit, so few will buy without a resolution.Look up owners

Hard to refinanceLenders usually refuse to lend against a property with an active lawsuit recorded.See verified leads

Released when resolvedOnce the case is settled, dismissed or paid off, the notice is typically released and the sale can move forward.Get fresh data

This guide provides general information only, not legal advice. Lis pendens rules vary by state, so consult a real estate attorney.

Investor opportunity

Why lis pendens matters to investors

For investors, then, knowing what real estate lis pendens is matters, because the notice is both a red flag and an opportunity.

On one hand, buying without understanding the lawsuit can leave you responsible for problems you didn’t create. On the other hand, owners facing foreclosure or costly disputes are often motivated to sell, and a fair offer can help them avoid a worse outcome.

How to approach these deals

Run a title search.
Confirm the lis pendens, the type of lawsuit and any other liens.
Understand the case.
Find out what the plaintiff wants and how much it would take to resolve.
Estimate total costs.
Add unpaid HOA dues, back payments, fees and repairs to your numbers. If they are too high, walk away.
Work with the owner and attorneys.
A settlement or payoff at closing can release the notice and clear the title.
Close with title insurance.
Only close once the title company can insure a clean title.

ForeclosuresDaily.com lead workflow: lead source, seller outreach, property analysis, offer decision, make an offer or pass

Finding leads

How to find lis pendens leads

Lis pendens notices are public records filed with the county. That means anyone asking what is real estate lis pendens in their market can look it up. However, tracking them across many counties takes time.

ForeclosuresDaily.com has supplied off-market leads since 2004, including lis pendens leads, updated daily. As a result, you can reach motivated owners early and focus on wholesaling, rehabbing and flipping.

Fix-and-flip investors

Brokers and realtors

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Cash buyers

Lenders

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See verified leads

Lead types

Motivated sellers eager for a quick sale

Every lead traces back to a life event that gives the owner a reason to sell. Pick the lead type you want to see our products for.

Probate leadsTo settle the estate, executors and heirs often need to sell the house.View lead products

Foreclosure leadsOwners racing a preforeclosure deadline who can protect their equity with a quick sale.View lead products

Divorce leadsCourt filings requiring a jointly owned home to be sold or divided, often within a set timeframe.View lead products

Inheritance leadsHeirs who were left a property, often from out of state, and would sooner sell than take on managing it.View lead products

Life leadsOwners who need a quick sale because of a major change, such as relocating or downsizing.View lead products

FAQ

What is real estate lis pendens: FAQ

What does lis pendens mean?

It means “suit pending.” It is a recorded notice that a lawsuit could affect a property’s title or ownership.

Can you sell a property with a lis pendens?

Legally, yes, but it is difficult. Buyers and title insurers usually want the case resolved or the notice released first.

How do I find out if a property has a lis pendens?

Run a title search or check the county recorder’s office for recorded notices.

Is a lis pendens the same as foreclosure?

No. It is a notice of a pending lawsuit. Foreclosure is one common reason for that lawsuit, but there are others.

How is a lis pendens removed?

Usually it is released when the case is resolved, settled or dismissed. In some cases, a court can cancel it.

Reach motivated owners before the crowd

Since 2004, ForeclosuresDaily.com has offered off-market real estate leads across the country, so you can talk with motivated sellers before a listing hits the MLS.