Does Anyone Have Any Info on Neumann Homes Going Belly Up?! (Joliet: lender, houses)

[martinez4]

Wow...I can't express how badly I feel for all of you in this horrible position. I will second the previous poster suggestion that you investigate legal advice as soon as possible. More than likely there will be a long list of creditors and unfortunately the buyers will be low on that list.

Since your neighborhood is not complete I would assume there is not a HOA that has been established. Since it is in the best interest of all residents both current and future to be fully informed, I would suggest that you attempt to get a neighborhood meeting together....who knows, there may be an owner who is an attorney and will assist others. It just helps to have a support system to make sure that the information you are receving is as accurate as possible.

For those of you that live out of the area and cannot meet at the neighborhood, perhaps you can a ask a friend or family member to a least attend or meet someone who can get you the most timely information possible.

Again, I am sorry for your situation and will check back here to see how it is going.

[Drover]

Originally Posted by martinez4

Wow...I can't express how badly I feel for all of you in this horrible position. I will second the previous poster suggestion that you investigate legal advice as soon as possible. More than likely there will be a long list of creditors and unfortunately the buyers will be low on that list.

Why would buyers be low on that list? They are secured creditors. It's the contractors who are going to get screwed the hardest. They can't just go in and tear out all of the plumbing and drywall and fixtures they haven't been paid for.

[irish setter girl]

I just read an interesting artlice on Journaltimes.com stating that a homeowner who had already closed and moved into her new home has found that a lien has been placed on her home for a 9k drywall bill that Neumann did not pay. Another homeowner found that three lien had been placed on his home. In another article an attorney was quoted as saying that all Neumann owners should check to see if liens have been placed on their homes. Depending on the title policy some homeowners could be liable for the debt. He also suggests before closing on any new contruction (Neumann or other builders) you should also get in writing that all contractors are paid. Owners can file a claim in bankruptcy court but expect to get pennies on the dollar. Good luck to all of you. Please check your title insurance to make sure you are covered!

[sbd78]

Originally Posted by irish setter girl

I just read an interesting artlice on Journaltimes.com stating that a homeowner who had already closed and moved into her new home has found that a lien has been placed on her home for a 9k drywall bill that Neumann did not pay. Another homeowner found that three lien had been placed on his home. In another article an attorney was quoted as saying that all Neumann owners should check to see if liens have been placed on their homes. Depending on the title policy some homeowners could be liable for the debt. He also suggests before closing on any new contruction (Neumann or other builders) you should also get in writing that all contractors are paid. Owners can file a claim in bankruptcy court but expect to get pennies on the dollar. Good luck to all of you. Please check your title insurance to make sure you are covered!

That's great news since I just closed on my home a month ago! There is a good chance I have leins against my home! Do you know how I go about finding out if my home has leins, and what the next step is if it does?

[irish setter girl]

I cut and pasted this from another article I just read. An important point for any Neumann owners:


“Everything is great except this whole bankruptcy thing,” neighbor Dina Wood said. Wood has two liens on her Neumann home. “As far as I know, I already paid for this home already. And I shouldn't have to pay subcontractors that I never even dealt with,” Wood said. So what can these people do? TODAY’S TMJ4 asked a Racine real estate attorney for answers. “If the lien is properly filed and title insurance doesn't cover it, then you're stuck," Attorney Dan Pettit said. “I think your recourse at that time is to make a claim in bankruptcy court and most of the time you're getting pennies on a dollar if you're lucky,” Pettit said. In some cases, title insurance will cover a homeowner. Before paying off a lien, a homeowner should check with their title company. Also, Attorney Pettit said that unless a builder can show proof that all of the construction bills have been paid, no one should ever close on a house.

[irish setter girl]

SBD78,
You asked how to find out if you have leins on your home. Well, you should be able to go to your local county building and ask them. If you know anyone who is an attorney or works for a title company ask them to do a title search on your home. A title search shows all mortgages and liens on a property. It can take some time for the liens to show up so you may want to check periodically with the county. Going through the county should be free. Running a title search generally costs money (which you pay for at closing) but if you know someone he/she may do it as a favor to you. There is a time period for liens to be filed. I think in Illinois it is two years to file a mechanics lien. I am not certain of this but there is some kind of timeframe. The first thing I'd do is pull out your closing docs from when your purchased your home. Find the title policy and call the title company. Explain what is going on and that you want to know if you are covered in the event a lien is placed. The only real issue with a lien on your property is that you can not sell the home until the lien is paid. Good luck to you!

[sbd78]

O.K., so my husband just called our title company and they said if we get any leins in the mail to send it to them, we aren't responsible for any of them. Thank God! I guess they have been flooded with calls of people worried about this because they are the main title company Neumann uses. But I should keep checking for leins so I don't get any I don't know about, right? I don't want to go to sell my house 10 years from now and find out I had a lein I didn't know about! Thanks for your help, irish setter girl!

[jstoler4156]

I guess I was one of the lucky ones, I had a call from Steve Holland and went to his office yesterday to pick up a certified check for my deposit on a new house less $ 500.00 for being part of their newhomemax program which they terminated on me. At least they are making some refunds, at this point i was happy to receive most of my deposit back.

[irish setter girl]

sbd78,
Glad to hear your title company will cover this. Just in case see if they will put something in writing stating you are covered if it is not written on the title policy. I would keep checking with the county. If a contractor is going to place a lien I am not sure how/if he needs to contact you. Sometimes the county will "serve" you papers while other times you are sent something in the mail. However, it could fall into another category and you may not be contacted personally. I would check in with the county every now and then. If you title company will cover the lien make sure you get a release of lien and file it with the county. You always want it in writing and have it filed. Good luck to everyone I know this is frustrating and now what you expect when you build a new home. I have heard rumblings with Centex homes. Not sure what is going on. I would think the big production builders would be more challenged right now than the small time custom builder. People like Neumann own a lot of land - some he could actually sell off and make some money. Other parcels are far too remote and too costly to develop - much harder to sell off. It will be interesting to see what happens. I hope they can turn things around.

[wisconsinfan]

Thought you might like to see this from our local TV station in Milwaukee from this past week regarding this builder and the problem some homeowners are now encountering.
I wish you the best.
Builder Files Bankruptcy, Homeowners Pay

**** Trevey


RACINE COUNTY - People in Racine County are getting unsettling news as they settle into their new homes. Builder Neumann Homes plans to file for Bankruptcy and homeowners say unpaid subcontractors are trying to collect money by putting liens on homes.

The doors to the sales center where people bought their Neumann homes have been locked all week because the company is filing for bankruptcy. That means people who bought houses here are getting a raw deal.

Lynn Michelau felt great about her new house four months ago. “Everything was great,” Michelau said. "They have a great big grand opening and celebration for you when you move in. They put a big red carpet and everything for you,” Michelau said.

However, things quickly went bad. A few months after her closing, Michelau found out the drywall contractor put a lien on her house because she says the builder, Neumann Homes, didn't pay an $8,000 drywall bill.

People across Sturtevant’s Chicory Creek Subdivision are in the same situation. “Everything is great except this whole bankruptcy thing,” neighbor Dina Wood said. Wood has two liens on her Neumann home.

“As far as I know, I already paid for this home already. And I shouldn't have to pay subcontractors that I never even dealt with,” Wood said.

So what can these people do? TODAY’S TMJ4 asked a Racine real estate attorney for answers.

“If the lien is properly filed and title insurance doesn't cover it, then you're stuck," Attorney Dan Pettit said. “I think your recourse at that time is to make a claim in bankruptcy court and most of the time you're getting pennies on a dollar if you're lucky,” Pettit said.

In some cases, title insurance will cover a homeowner. Before paying off a lien, a homeowner should check with their title company. Also, Attorney Pettit said that unless a builder can show proof that all of the construction bills have been paid, no one should ever close on a house.

Neumann Homes also has two subdivisions in Kenosha County.