Defect In Serving Notice Of Legal Action, Subsequent/Innocent Buyer's Failure To Probe Rights Of Occupants Leads Court To Void Sale Of Foreclosed Home

A 2006 decision of a New Jersey trial court provides another example of the problems a foreclosing creditor causes for itself and others when it chooses to serve delinquent property owners with notice of a foreclosure action by publishing a legal notice in a local newspaper (ie. known as constructive service - service by publication) without first making a diligent search and inquiry of the names and the whereabouts of the property owners in a manner satisfactory enough to establish that face-to-face service (ie. known as personal service) upon the property owners is not possible.

The decision also addresses the problems a property purchaser has when asserting bona fide purchaser status when it buys property subject to the occupancy of someone other than the seller, and fails to inquire as to the nature of any property rights (either recorded or unrecorded) that the occupants may have in the home.

For the long version of this post, including links to court decision and other relevant cases, see Faulty Service Of Process In Tax Foreclosure, Failure To Investigate Rights Of Persons In Possession Leaves Unwitting Buyer Empty Handed.

Go here and go here for other posts on foreclosures involving faulty notifications to property owners. foreclosure faulty notice ScrewUpProcessServing