Questions about caveats

Hi all, my last thread was deleted for asking about a legal issue in a the legal issue section of the forum, (silly me! :confused: ). I'll try and avoid anything that will get this thread deleted and just ask about caveats if that is allowed?
The caveat is placed on a property in Tasmania.

1) Is there a time limit on caveats? I read somewhere they lapse after 6 months then need renewal, I then read another place it's 5 years?

2) Can they be placed to recoup legal costs even if it is totally unrelated to the property?

Thank you all for any info :eek:
 
thanks for that link. after reading this part I feel I am stuffed :(

"A creditor may have a written agreement with the vendor by which the creditor is permitted to lodge a caveat to secure a loan."

As I was tricked and pressured into signing a contract giving him permission to place the caveat... :(
 
Not in my experience.

I recently had a client who knew about a caveat a few years ago on one property. It turns out that all of his properties had caveats put on them (even though they had nothing to do with the deal). None of the caveats were removed and it was only when we were reviewing the loans that it became apparent they were still there.

Removing the caveats weren't a problem, but it did take a little time and was a pain in the neck that we didn't need.
 
The owners solicitor put in an application to remove the caveats. I'm not sure of the technical process involved. It took a few days to complete the process.

The caveats were put in place as the owner had to do some creative financing a few years ago and used one of his existing properties as security for a short term loan.
 
so these were just cases where the caveats terms had been met, but were failed to be removed, he had paid back the short term loan, the caveat had not been removed by the financer?
 
so these were just cases where the caveats terms had been met, but were failed to be removed, he had paid back the short term loan, the caveat had not been removed by the financer?

Yes, except that only one property was offered as security, but the financier put caveats on all of the borrowers properties, without properly informing him.

What complicated matter further, was that the lender ceased trading (probably due to the GFC) and the caveats were then held by a different lender who originally underwrote the loan.
 
Caveat

Hi,

My sister helped me with renovating my home just after purchase and spent some $40K in costs on the house. I never asked her to do this and I never agreed to pay it back.

I bought the house in my name and I took out the mortgage in my name soley.

After a fall-out, she is now threatening to place a caveat on my house and wants to stop me from making a sale.

Is she entitled to a caveatable interest?

Any advice is appreciated.
 
On the bare facts you have outlined there is not a caveatable interest, but what was the rest of the understanding between you and your sister? Do you really want to have strain in the family over $40,000?
 
I sure dont want to have a strain in the family over this. I am not sure what I should do as my intention was to pay her back with sale proceeds after I have paid my mortgage debt. If there are any profits that is.

If she puts a caveat on though, then I will not even be able to sell to give her any money out of the sale.
 
A caveat will prevent any further dealings with the property, but if the caveat holder agrees the property could be sold with the sister removing the caveat at settlement when she receives the money.

I still think she could have a caveatable interest as the funds were not just a loan, but she helped with the improvement of the property. This would give her an equitable interest in the property.

If someone just lend money unsecured then it is a different matter.
 
I sure dont want to have a strain in the family over this. I am not sure what I should do as my intention was to pay her back with sale proceeds after I have paid my mortgage debt. If there are any profits that is.

If she puts a caveat on though, then I will not even be able to sell to give her any money out of the sale.
Over the past 20 years i have bought 2 properties that had caveats on the property,one was from a person within the family,the other was from the "ATO",and the public defenders office,the one with the ATO,and the public defenders was not a big problem,that one took 4 contracts that fell over the son was living in the house,selling various drugs to a high number of people,once it went to court everything he was doing to stop
the sale went out the back door,the unpaid tax and the fine blew him and his mother out the back door,but it took six month..
The other one was out in the country,but money has a strange way of getting the caveat lifted,once each person understands it's better to take the money and go their own way..
Caveats can be a real problem,and can stand over the property for a long time,just depends on how many there are in the que,and no matter what anyone tells you the property can't be sold till the caveat is lifted,but that was 10 years ago,and from what i'm told that law still stands
..imho..willair..
 
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No, not true. If (when) you sell, she'll just be one of the creditors, along with your mortgagee that is in line to receive funds out of the settlement.
The only issue, as far as my admittedly limited understanding goes, the primary concern will be that the purchaser will need reassurance, when they learn of the caveat, that sale proceeds will be sufficient to clear the debt and have the caveat removed. In other words, unless it's dealt with "up front", it could cause huge delays in effecting a sale. Even dealing with it up front, it could impede a sale.

I imagine that the best way to deal with it, if a caveat is lodged, would be to get some proof of the amount (is the amount listed on the caveat? I don't know :confused:), and prove to the purchasers that settlement proceeds will be sufficient to satisfy the caveat plus your mortgage, so that the purchasers are reassured that they'll receive clear title after settlement.

Even better would be to prevent her lodging a caveat at all; I imagine many buyers would be too nervous to proceed with buying a property with any such "complications". (Even though it may only be perception that it's complicated.)

Would your sister agree not to lodge, or remove, a caveat, if you give some enforcable undertaking of the debt, and an agreement to pay it within, say, 7 days of settlement?

Completely aside, and purely out of curiosity and nosiness, how do you go from having a sister who - unasked and without compensation - spends $40K on improving your house, to things breaking down to a point where she's contemplating legal action against you? Having a completely drama-free family (fortunately), I'm seriously mystified as to how it happens...
 
The only issue, as far as my admittedly limited understanding goes, the primary concern will be that the purchaser will need reassurance, when they learn of the caveat, that sale proceeds will be sufficient to clear the debt and have the caveat removed. In other words, unless it's dealt with "up front", it could cause huge delays in effecting a sale. Even dealing with it up front, it could impede a sale.

That's true :)
 
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