How do I remove the lien and refinance when my title is defective? – North Carolina

Short Answer

In North Carolina, you cannot refinance until your title is marketable. When a manufactured home was not properly converted to real property and a fraudulent affidavit clouds the record, you typically: (1) cancel the DMV title and record the affixation documents; (2) clear any false or disputed filings through a court order; and (3) remove the lien by recording a satisfaction or other authorized release. Once the Register of Deeds records the curative documents, lenders can underwrite the refinance.

Understanding the Problem

In North Carolina, how do I clear a lien and complete a refinance when my land title is defective because the manufactured home was never properly titled as real property and a fraudulent affidavit was recorded? Here, you bought property represented as including the manufactured home, but during refinancing you learned the home’s title was never retired and a false affidavit is in the county records. The home’s status and the bad filing block marketable title, so the lender will not close.

Apply the Law

North Carolina treats a manufactured home as personal property unless its DMV title is canceled and it’s legally affixed to the land. To make the home part of the real estate, you must retire the DMV title and record the required affixation paperwork with the Register of Deeds. If the records contain a fraudulent or disputed instrument, the Register of Deeds generally cannot remove it administratively; a judge’s order in Superior Court is the usual path to clear the cloud (often through a quiet-title or declaratory-judgment action). A lien is cleared by recording a satisfaction or other authorized release; if the creditor does not cooperate, state law provides a process to record a satisfaction by affidavit after statutory notice. The main forum for removing clouds is the Superior Court in the county where the land sits; recording happens at the county Register of Deeds.

Key Requirements

• Convert the manufactured home to real property: Cancel the DMV title and record the affixation documents so the home becomes part of the land.
• Correct the land records: Use a corrective instrument for minor errors; use a court order to nullify fraudulent or disputed filings.
• Remove the lien: Obtain a payoff and record a satisfaction or use a statutorily authorized satisfaction by affidavit if the creditor does not act.
• Use the right forum: File a civil action in Superior Court (county where the land lies) to remove clouds and confirm ownership if needed.
• Record everything: After court relief and DMV action, record the order, affixation documents, and lien releases with the Register of Deeds to make title marketable.

What the Statutes Say

• North Carolina Gen. Stat. § 20-109.2 (Manufactured home title cancellation) – Cancels DMV title so a manufactured home can be treated as real property.
• North Carolina Gen. Stat. § 41-10 (Action to quiet title) – Lets an owner sue to remove clouds and adverse claims from title.
• North Carolina Gen. Stat. § 47-36.1 (Correction instruments) – Allows recording of corrective instruments to fix certain errors in recorded documents.
• North Carolina Gen. Stat. § 47-18 (Recording statute) – Protects purchasers and lenders who rely on properly recorded documents.

Analysis

Apply the Rule to the Facts: Because the manufactured home’s DMV title was never retired, the home is still personal property; your deed alone did not make it part of the land. Step one is to cancel the DMV title and record the affixation documents so the home becomes real property tied to the land. The fraudulent affidavit is a cloud the Register of Deeds cannot simply delete, so you file a quiet-title/declaratory action in Superior Court to have the court void it. For the lien, you obtain a payoff and record a satisfaction; if the creditor does not cooperate, pursue a satisfaction by affidavit after required notice.

Process & Timing

1. Who files: The property owner. Where: Superior Court in the county where the land is located; recording at the county Register of Deeds; DMV for title cancellation. What: Civil complaint for quiet title/declaratory judgment; notice of lis pendens; DMV title-cancellation paperwork for a manufactured home (e.g., MVR-46G or current DMV form); corrective or curative instruments; payoff letter and satisfaction/release. When: Start as soon as the refinance is blocked; court timelines vary by county and case complexity.
2. Work with DMV to cancel the manufactured home title, then record the affixation/cancellation evidence with the Register of Deeds. In court, seek an order voiding the fraudulent affidavit and confirming your title. In parallel, request a payoff from the lienholder and arrange for a recorded satisfaction or, if needed, a satisfaction by affidavit after statutory notice.
3. Record the court order, DMV affixation/cancellation documents, and lien satisfaction at the Register of Deeds. Confirm the updated title commitment with your lender, then proceed to close the refinance.

Exceptions & Pitfalls

• If the prior titled owner of the manufactured home cannot be located or will not sign, DMV may require alternative proof or additional steps; plan for added time.
• The Register of Deeds generally cannot remove fraudulent documents without a court order; expect to seek relief in Superior Court.
• Some liens are UCC fixture filings on the home; obtain a termination from the secured party in addition to any deed-of-trust satisfaction.
• Payoff statements expire; confirm wire instructions and record the satisfaction promptly to avoid delays.
• Refinance lenders usually require the home to be real property and title to be clear; partial fixes (like unrecorded releases) won’t satisfy underwriting.

Talk to a Real Estate Attorney

If you’re dealing with a blocked refinance because a manufactured home was never converted to real property and a bad filing clouded your title, our firm has experienced attorneys who can help you understand your options and timelines. Call us today at [919-341-7055].

Disclaimer: This article provides general information about North Carolina law based on the single question stated above. It is not legal advice for your specific situation and does not create an attorney-client relationship. Laws, procedures, and local practice can change and may vary by county. If you have a deadline, act promptly and speak with a licensed North Carolina attorney.