During a title search on a property in New Jersey, buyers and lenders occasionally find a document recorded against the property called a lis pendens. Understanding what it means and how it affects a transaction is important before proceeding.
What a lis pendens is
Lis pendens is Latin for “suit pending.” Under state law, a notice of lis pendens is recorded in the county clerk’s office where the property is located. It is not a monetary lien or a court judgment. It is a public notice that an active lawsuit exists that could directly affect the property’s title or ownership.
Recording a lis pendens serves two purposes. It puts future buyers and lenders on notice that the property is in litigation, and it binds anyone who acquires the property after recording to the outcome of that lawsuit.
When a lis pendens can be recorded
In New Jersey, a lis pendens cannot be filed for standard money disputes. It is limited to lawsuits where the plaintiff claims an actual interest in the real estate itself. Common situations include:
- Mortgage foreclosures: lenders record a lis pendens at the start of judicial foreclosure proceedings to preserve priority
- Specific performance claims: when a seller backs out of a contract, the buyer may sue to force the sale and record a lis pendens to prevent a competing transfer
- Boundary and ownership disputes: quiet title actions, partition suits, or disagreements between co-owners or neighbors
- Construction lien enforcement: lawsuits seeking to enforce a mechanics’ or construction lien against a property
Each of these involves a direct claim to the property rather than a general request for money damages.
How it affects your closing
An active lis pendens will stop a closing. Title companies will not issue a clean policy, and lenders will not fund until the dispute is resolved. Resolution requires either a voluntary discharge filed by the plaintiff after settlement, or a court motion if the plaintiff cannot demonstrate a valid claim to the property.
If a lis pendens has been found on a property you are buying or selling, a real estate attorney in New Jersey can help you evaluate your options and protect your transaction.