If there are any attorneys and/or title companies involved in the transaction, the Seller's judgment will be paid as part of your purchase closing (escrow closing).
It sounds to me like you are trying to buy a For Sale By Owner. Many times, licensed real estate professionals try to assist FSBOs and find out that there's something unworkable in the situation, so don't bother listing it for sale. Unworkable situations in NYS can be as simple as the Seller refusing to disclose his social security number (which makes the TP-584 and RP-5217 Property Transfer Forms un-recordable and unacceptable. Sometimes, the seller wants more money than the property is worth. Sometimes, the property has undisclosed property conditions (even land can have issues, such as buried toxic waste.) The theoretical list can go on almost indefinitely!
The seller has to prove the judgment was already paid, was judicially released via a Bankruptcy proceeding by a Bankruptcy Court, or pay. Unfortunately we live in the year 2011 and computers keep track of outstanding debts on every parcel. You can't run and hide from judgments. If the judgment was against someone of a similar name but not in fact the seller, the resolution is different again.
I hope by now you got an attorney to assist you in fixing this!... more
1. Why are you listed as a "home buyer" here, when you are talking about a foreclosure? My interpretation of the situation is you are a "seller" not a "buyer."
2. Although I have personally seen this type of "Deed in Lieu of Foreclosure" agreement (as a Notary Public), I agree wholeheartedly with the other responders that this is a LEGAL question which your attorney needs to answer. If you don't trust your attorney get a second opinion in your local area from an attorney who practices in the County (and State) in which the property is situated. Every legal municipality has its own rules, standards of practice, and laws.
3. If you have a DSS lien and are under threat of foreclosure/legal action, you also need to locate another place to live. There are multiple companies in the Rochester NY who specialize in "low income housing" (keywords to add to your desired residence location in an internet search engine.)
4. Good luck!... more