- June 12, 1991
- All Issuing Offices
- Federal Debt Collection Procedures Act of 1990
New Act. Congress has passed the Federal Debt Collection Procedures Act of 1990. This Act is effective May 29, 1991. The Act applies to judgments in favor of the United States.
- Creation of United States Judgment Liens. A judgment
lien in favor of the "United States
" is a judgment lien in favor of a federal corporation;
an agency, department, commission, board or other entity of the United States;
or an instrumentality of the United States. A judgment in favor of the "United
States" is effective upon the filing of a certified copy of the (abstract
of the ) judgment. A judgment is a judgment rendered in favor of the united
states in a court created by congress. You should review your local records
to verify whether a certified copy has been recorded.
- Duration of Lien and Renewal. The judgment lien is
effective for twenty (20) years. The judgment lien may be renewed
for one additional period of
20 years upon the filing of a notice of renewal. The renewal shall relate
back to the date the judgment lien was originally filed. The renewal could
theoretically occur at any time during the initial 20 year period, so long
as the court approves the renewal.
- Applicability to Pre-Existing Judgments of the United
States. The Act applies to judgments by the United States entered on or
after May 29, 1981. Example
State law provides that a judgment lien is effective for 10 years. The United
States secured a judgment on June 1, 1981 and recorded a certified copy on
that date. The judgment lien is effective until June 1, 2001. It may be extended
by a renewal.
- Exempt Property. The Act provides that property that
is exempt under state law (including tenancy by the entirety or joint tenancy
property ) or under federal bankruptcy law may be exempted from the
judgment lien. State law exemptions (such as tenancy by entireties) are not
under the Act. Do not rely
on the exemption unless you secure a court order for our review.
- Attachment. The United States may file a Notice of Levy on real property
before securing a judgment. If the United States then secures a judgment,
the judgment lien relates back to the time that the Notice of Levy was recorded.
You must except to a recorded Notice of Levy.
- Redemption by Debtor. A judgment debtor may not redeem
property after the execution sale in favor of the United States. Do not
insure on an execution sale
on a judgment in favor of the United States without review by our Legal
- Redemption by "United States". If a superior mortgagee forecloses,
the "United States" may assert a right of redemption for one year.
The United States may claim this right even if the foreclosure is nonjudicial.
If a prior mortgagee forecloses and extinguishes a United States judgment
lien, add the following exception:
"Rights of redemption of (state the "United States" entity in the judgment) for one year from (date of foreclosure)."
If state law creates a longer redemption period, except to that period.
THIS BULLETIN IS FURNISHED TO INFORM YOU OF CURRENT DEVELOPMENTS. AS A REMINDER, YOU ARE CHARGED WITH KNOWLEDGE OF THE CONTENT ON VIRTUAL UNDERWRITER AS IT EXISTS FROM TIME TO TIME AS IT APPLIES TO YOU, AS WELL AS ANY OTHER INSTRUCTIONS. OUR UNDERWRITING AGREEMENTS DO NOT AUTHORIZE OUR ISSUING AGENTS TO ENGAGE IN SETTLEMENTS OR CLOSINGS ON BEHALF OF STEWART TITLE GUARANTY COMPANY. THIS BULLETIN IS NOT INTENDED TO DIRECT YOUR ESCROW OR SETTLEMENT PRACTICES OR TO CHANGE PROVISIONS OF APPLICABLE UNDERWRITING AGREEMENTS. CONFIDENTIAL, PROPRIETARY, OR NONPUBLIC PERSONAL INFORMATION SHOULD NEVER BE SHARED OR DISSEMINATED EXCEPT AS ALLOWED BY LAW. IF APPLICABLE STATE LAW OR REGULATION IMPOSES ADDITIONAL REQUIREMENTS, YOU SHOULD CONTINUE TO COMPLY WITH THOSE REQUIREMENTS.