Quote:
Originally Posted by recycled sixtie
...Is the issuing company of the mortgage always on the hook because they did not do enough research on the new mortgage application?
Is there a time limit on suing the mortgage co. and the person who made the new mortgage application?
How do I know if somebody has successfully applied for a mortgage against our paid up property if the bank has not done its homework properly?
|
Recycled:
Alberta has the Torrens Land Registration system, where the provincial government guarantees that certificates of title and the registrations endorsed on them, are correct. This is called indefeasibility of title.
There are some exceptions to indefeasibility, and one of them is fraud. So if a homeowner discovered someone had forged his name on a mortgage, he could sue the lender for an order discharging the mortgage. The homeowner must sue within 2 years of when he knew, or ought to have known, about the mortgage, with an absolute time limit of 10 years (the drop dead period).
Mortgage lenders carry blanket insurance policies on their loans to protect against fraud, but most homeowners don't. It is possible to buy title insurance in Alberta at relatively low cost, but the forging of signatures on mortgages, in my experience, is very rare. I have seen only two cases in 44 years of practise.
Please note that I am not commenting specifically on your neighbour's case.