FiFa is a four-letter word

FiFa is a four-letter word

FiFa is a four-letter word

 

Well technically FiFa is not a four-letter word. It’s an abbreviation for the two Latin words Fieri Facias that translate to “you shall make happen,” which you’ll understand in a minute.

 

FiFa is a four-letter word

 

A FiFa is a lien issued by the clerk of court to a lawsuit winner who has been awarded a judgment. This lien becomes public record and gives the sheriff’s office the authority to seize any assets that the debtor may have in order to satisfy the lien and pay off the judgement.

 

Fieri Facias actually charges the sheriff’s office with the duty of making the debt good. In other words, they “shall make it happen.”

 

Although the sheriff’s office has the power to conduct a sale on both real estate and personal property, like vehicles and boats, to satisfy the lien, that’s not the common practice anymore.

 

Today, the lien is filed at the courthouse under the debtor’s name. The creditor then waits for the debtor to sell a piece of real estate. And when the debtor’s closing attorney does a title search, the FiFa shows up and the attorney pays it off at the time of closing.

 

Filing the FiFa in the debtor’s name and not on a specific piece of property like other liens means the FiFa clouds the title to any and all property the debtor may have at the time of the judgement. It also clouds titles of anything they may try to buy and sell during the next seven years, which is the statute of limitations for this type of lien.

 

FiFa’s are meant to protect the interest of the creditor, but we ran into a problem with the process recently. It took some real effort to overcome, and I’d like to share the story with you.

 

We were negotiating on a nice three-bedroom, two-bath double-wide in Gordon County with beautiful views of the country. We got it under contract and sent the paperwork over to our attorney to get the title search going and set a time for closing.

 

FiFa is a four-letter word

The seller confided in me that when she had purchased the property, she was just given a warranty deed and had never gone to a closing.

 

That meant there was a high likelihood that no title examination had been done, nor title insurance issued, and there could be liens against the property that my seller wasn’t aware of.

 

Sure enough, the title search came back with two FiFas against the previous owner’s name. They totaled nearly $15,000, and they should’ve been paid by her seller when she bought the property.

 

But we noticed something when we looked at the lien: The FiFa was made out to a very common name. We will use “John Brown” for illustration. But just to be clear, the real name was just as common.

 

The FiFa said that a John Brown of Gordon County owed nearly $15,000 to creditors. It was not clear who the individual actually was: we rightfully assumed that more than one John Brown had lived in Gordon County during the past seven years. The question then became, “Is the John Brown on the FiFa the same John Brown who owned the property we are buying?”

 

Our office manager, Marybeth, worked her magic and found the original case file where it listed the middle name of the John Brown being sued as “William.” The person who had owned our subject property was a John Henry Brown.

 

This discovery gave us the information we needed to close the deal with title insurance.

 

FiFa is a four-letter word

 

But notice what happened: Because the FiFa was issued with a very common first and last name only, that lien cast a very wide net over Gordon County. And at the end of the day, the burden of proof fell to the people, not the court. Be mindful of that concept the next time you see a FiFa show up on a title search.

 

Joe and Ashley English buy houses and mobile homes in Northwest Georgia. For more information or to ask a question, go to www.cashflowwithjoe.com or call Joe at 678-986-6813.

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