Definition of "In rem"

Jeff Graham real estate agent
Jeff Graham, Real Estate Agent Weichert Realtors-Webb & Associates

The definition of in rem in real estate is a legal case against a property rather than a person. The legal application of in rem in real estate is most often seen when a homeowner defaults on their mortgage and the bank forecloses on the property. In such cases, the court must be located in the same county as the property being prosecuted. 

Example of in rem in real estate 

Will is an ambitious software developer living in the heart of the Silicon Valley. After designing and selling the rights to a successful ride-sharing app, Will suddenly finds himself in the possession of a large sum of money. As many newly wealthy individuals often do, Will quickly bought an extravagant home in an affluent neighborhood. 

However, things would not continue to go well for Will. The tech game is a cutthroat place, and those who don’t continuously innovate are rapidly left behind. As project after project fails, Will’s bank account shrinks further and further, and before long he is deep in debt, due to his lavish but unsustainable lifestyle. 

Before long, the bank comes around looking for its monthly payment, and Will is unable to pay. The next month, the situation remains the same, and by the third month the house is marked for repossession. With his credit score at an all time low and nowhere to turn, Will packs up his belongings and leaves the house, unable or unwilling to face the consequences of his choices. 

With Will nowhere to be found, the bank proceeds to file an in rem case against the property itself. With no objections, the case proceeds, and in a very short period of time the bank has foreclosed on the home. This is an example of how in rem is used in real estate.

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