Liens are legal instruments used to protect creditors, and others owed money by property owners. Banks, contractors, and courts frequently utilize liens to collect lawful obligations. A lien against property is a legal claim. Importantly, liens can hinder owners from borrowing or selling their property. Foreclosure and sale of the underlying property are options available to lienholders.
Lien Basics
A lien is a legal claim against real estate documented with the local county and grants the lien holder a legal interest in the property. A property owner or a court can usually grant a lien against property. The lien is against a specific parcel of land and documented with the local county recorder after it is issued or awarded.
When a lien is issued on a property, it might prohibit the owner from demonstrating clear title when selling the property, making the new owner liable for clearing the problem. It may also make it difficult to obtain a mortgage or subdivide their land until the debt is paid off.
How They Work
These claims are either granted by the property owner or imposed by somebody who has filed a claim against them. One way to clear them is to sell them to a company like Mayflower Judgments. Another way is to pay what is owed.
When a homeowner fails to pay real estate taxes, the government can register a lien against the property. They can also be filed by individuals who have won ajudgment against a property owner but have not yet received payment.
