This isn't urgent for first time buyers, but it's something to be mindful of after you buy your first home.

I've read stories where people lose their home over unpaid property taxes (small amounts even)

and this story is no different.

The story

A homeowner in Massachusetts lost her house over a mortgage she thought was gone

She had lived in her home for years and stayed current on her primary mortgage.

She had taken out a second mortgage before the 2008 housing crash.

After the crisis, statements stopped and there was no communication for years.

She believed the debt had been resolved.

More than a decade later the debt holder showed up to foreclose.

The story is covered by WBUR (NPR affiliate) here

Apparently there are 600,000+ of these second mortgages that could be a risk to homeowners. (If you purchased pre-2008 crash)

What's a zombie mortgage?

These loans are commonly referred to as “zombie mortgages.”

A zombie mortgage is a second mortgage or HELOC that went unpaid during the housing crash, then sat dormant for years with no statements or collection activity, only to be revived later once home prices recovered.

The CFPB has info on it here

One reason this problem catches people off guard is that these loans often do not appear on credit reports.

Many were charged off years ago and stopped reporting to credit bureaus, even though the lien itself remained attached to the property.

Checking your credit for something like this won't do the trick.

How to protect yourself

What you should do to check for second liens on your property:

You can find your property documents on your county website, directly with the county assessor/records, or with a title company.

Look for recorded second mortgages, HELOCs, or home equity loans, even if they are old.

Check any past loan modification or bankruptcy paperwork to confirm whether a second lien was formally released or discharged in writing.

If you see an old lien you do not recognize or believe was resolved, speak with a real estate attorney or HUD-approved housing counselor before assuming it cannot be enforced.

This mostly affects homeowners who bought before 2008, but as a new homeowner it's a good practice to check your home's title work every so often.

Don't lose your home to ignorance.

Sam