B-125310 October 14, 1955

B-125310: Oct 14, 1955

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That the property was sold at a deed of trust sale by the first mortgagee. Who was the purchaser. Desires that the release be executed in order that she will have a clear title. It is stated that the Federal Housing Administration has left the matter up to your office whether or not a release should be executed. That the Administration pointed out that there is a reputable court authority for the fact that the interest of the Federal Housing Aministration was extinguished upon conclusion of the deed of trust sale. The view is expressed in your letter that there is no question but that all right. Title and interest of the United States by virtue of the Federal Housing Administration claims were completely extinguished by the deed of trust sale.

B-125310 October 14, 1955

Russell B. Wine, Esquire United States Attorney Post Office Box 1701 San Antonio 5, Texas

Re: Newton, Mrs. caroline E. (Mrs. B.F.) NCP No. 937549, Claim Nos. 5 053827, 5 053828, AND 5 053829 Note Nos. 1347, 7907, 8502, and 6768 Bls.: John A. Bludau Your reference: HP: axb

Dear Mr. Wine:

Reference si made to your letter of August 19, 1955, concerning the above matter, and requesting that the proposed form of release of lien transmitted therewith, covering certain property located at 509-511 Avenue B, in the City of San Antonio, Bexar County, Texas, be executed by the Comptroller General pursuant to the provisions of 28 U.S.C. 2410(d). Also, there has been received your letter of October 7, 1955, relating to the same matter.

It appears from your letter of August 19 that the United States held a subsequent and inferior lien to a first mortgage on the property in question, that the property was sold at a deed of trust sale by the first mortgagee, and that the present owner, who was the purchaser, desires that the release be executed in order that she will have a clear title. It is stated that the Federal Housing Administration has left the matter up to your office whether or not a release should be executed, and that the Administration pointed out that there is a reputable court authority for the fact that the interest of the Federal Housing Aministration was extinguished upon conclusion of the deed of trust sale. The view is expressed in your letter that there is no question but that all right, title and interest of the United States by virtue of the Federal Housing Administration claims were completely extinguished by the deed of trust sale. However, in view of the present owner's request your office recommends execution of the release.

We have no authority, of course, to issue a certificate of release of liens of the Unite States except upon the conditions expressly stipulated in 28 U.S.C. 2410(d), 17 Comp. Gen. 180. The conditions expressly stipulated are that the applicant "has a lien" upon the property, duly filed of record, and that a "junior lien in favor of the United States attaches to such property." In the present case, the applicant is the property owner and not the holder of a lien upon the property. Moreover, since it is stated that the property was sold under a deed of trust sale by the first mortgates, it is assumed that such sale was made by a trustee or trustees pursuant to a power of sale. Thus it would appear that upon the foreclosure under the first deed of trust, the junion lien on the property was extinguished. See Texas Bitulithic Co. v. Moore, Tex. Civ. App., 102 S.W.(2d) 439. Hence, a junior lien in favor of the United States does not appear to attach to the property.

In view of the foregoing the proposed form of release of lien is returned unexecuted.

Sincerely yours,

Frank H. Weitzel Assistant Comptroller General of the United States

Enclosure