Our client bought a home that had previously been in foreclosure. However, when she attempted to refinance the home, her lender discovered that there was still a mortgage on the property. She could have been liable for thousands of dollars to pay off this outstanding loan – a loan that triggered a lien on the property that should have been eliminated by the City of Denver Public Trustee’s Office in the course of the foreclosure.
Fortunately, our client had title insurance and we filed a Notice of Claim letter with her insurer. They reviewed the policy and the facts of the case and found that the lien should indeed have been removed as part of the foreclosure action. Our client was in the clear and the insurer settled the matter with the City of Denver and the lender holding the lien.
We advise anyone buying real estate in Colorado to purchase title insurance to ensure they have a clean, “marketable” title with no undisclosed defects or encumbrances on the property. We also work with our clients to make sure their title insurance is adequate and appropriate and does not unreasonably exclude certain circumstances and conditions.