What is a Lien?
|
|
A lien is a legal claim or a "hold" on some type of property, whether personal or real property, making it collateral against monies or services owed to another person or entity. A lien usually exists in situations like second mortgages, loans against a vehicle title, or money loaned against any other substantial item owned by a borrower. It may keep the borrower from selling the property, or at least keep him or her from transferring title to the property.
Any property that carries a lien can be forced into sale by the lender, in order to collect what is owed, if the loan is in default. If the borrower decides to sell the property, the lien holder must be paid before the title will be cleared for transfer to the buyer.
There are different kinds of liens, and one of the most common is a mechanic's lien, also known as a construction lien. This type of lien is put into place when the property owner owes money for materials or labor which improved the property in some way. This can include repairs, maintenance, and new construction, as well as things like landscaping and renovation.
When purchasing real estate, it is important to make sure there is no lien on the property that will keep you from securing a clear title. This is accomplished by conducting, or hiring an abstract company to conduct, a title search or "abstract of title." This simply means developing and examining a collection of publicly recorded documents regarding the history of the property.
A title search will usually indicate whether or not a lien exists and whether the seller is the legally recognized property owner. It should also indicate the exact legal description of the property, as well as providing details regarding a lien or other encumbrances against the title. This is especially important if you are using creative financing techniques to purchase the property, such as owner financing or a land contract. Otherwise, once you have paid the agreed upon price, you may discover that you still do not own the property free and clear.
|
Related wiseGEEK articles
Category
|
Discuss this Article
My family has been a bid in on property that has a Medicaid lien against it. Does anyone know how long it takes for the State to let you know if they accept the bid or not? I am in Illinois.
- kiley79
I am losing all my investment properties with first and second mortgages on them. My primary residence is mortgage free. How can I save this one? Should I claim it to my son before any possible lien on it? Should I add his name to the deed? Can I sell it to him? and if I do none of the above, can I one day rent it or sell it? How legally secure is one with his only property as a primary residence?
- tree
What are the exact steps needed to put a lien on an
automobile?
- stargazer05
Any lien on property can be superseded by the UCC-1 Financing statement and lien under the uniform commercial code.
- pyramid777
Property used to secure bail, can this be a lien on the property?
- anon28485
Boiler 23 ,you have great standing to individually file an action for the monies paid out on the motorcycle by you. What state are you located within?
- pyramid777
I live in west virginia. I bought a house from a contractor and we did a title search and everything was clear and the process went on. Now I am getting a notice that there is a mechanics lien on my property. Can they do it now?
- hot2talk
I live in GA, and I was living in my parents home while they were overseas. I personally signed the contract to have lawn work done to the home while I was living there. I do not own the home and have no rights to the home. Is it possible for the lawn service to put a lien on my parents property even though I am the one who took out the contract?
- anon25840
I live in the state of Georgia and I owe for this years Homeowners Associations fee and I haven't paid as of yet, due financial difficulty and I just received in the mail a letter from an attorney stating that this amount owed must be paid before the end of the year or they will put a lien on the house. If this should happen, how does this affect me in the long run as far as my credit? I know that liens shows up on your credit, but will that be a factor for me in the future if I wanted to get credit?
- anon22803
My mother had her house remodeled in 1987, she and her husband signed a contract to put up property as collateral, the company that did the siding went bankrupt or went out of business and no one notified them now it twenty-one years later and my father is past away and someone writes her and tell her if she does not pay 29,000.00 for a 8,000.00 loan they will foreclose. Can this happen?
- iamlaidoff
I had a boiler installed in my bar. I have been making payments on the boiler but the company recently got ugly about it and demanded payment in full or they would put a lien on the building. Two questions. In Colorado, if they have passed the 4 month mark, has the statute of limitations in which they can file a lien expired? Additionally, I am only leasing the building. Can they put a lien on someone elses property for money I owe them?
- spoons35
Might interest any of you who come to France, that the word "LIEN" means "LINK" (as in a chain or on the Internet!)
- anon14409
I had a contractor place a lien on my property. I am building a house and we had a dispute over billing. I have paid him in full and he has now placed a lien on my property 7 months after the job was completed and also did not give me the proper 20 day notice. Any advise on what I should do would be very helpful!
- mparrish
My uncle was recently worked on a construction project as a laborer for a subcontractor who was subcontracting the work for the general contractor of the project. He has the feeling that he was not going to get paid for the work he did. He does not know anyone from the general contracting company and he knows that he will get no where talking to his employer. I just want to ask what options does he has in terms of getting his pay?
- nikoscorpio
Hi, I live in georgia and I purchased 2 investment properties in 2006. I didnt know alot about it and ran into some difficulties paying the mortgage when the tenants did not pay. They are about to foreclose in 2 weeks and I was wondering if they could put a lien on my personal property if I cant pay balance after if sold. Please advise what steps I need to take to protect myself.
- mckinneytl
i live in georgia and i purchased some bad investment property. they are going to foreclose in two weeks and i wanted to know if they can put a lien on my personal property?
- anon9980
Im in Texas.. My mother passed away 2 yrs ago and left me a house with land. Im now in the process of selling the property. My mothers brother helped buy the bricks for use on the house back in the late 70's early 80's. I dont know what agreements were made between them but I'm thinking he may try to put a lien on the house. Is this possible? What proof will he need? How would I fight this if needed?
- ksmtx
In order to put a lien on someones property what do I need as proof? I lent money to a company and the company shut down. This happened over 2 years ago. Do I still have the right to go after one of the owners personally? The money was given to one of the other partners which deposited it in the company account.
The only proof I have is the cheque which was made out 2 years ago. Do I need proof of this individual cashing it personally? or a time frame. I was told that I can only go after the company and the person. And it has been more than 3 months so therefore it is past the time frame. - toni
I recently co-signed for a motorcycle for my brother-in-law and he has not made a payment on it since last march. I have recently been contacted by the manufacturer of the bike saying I needed to pay $3,500 or the bike was going to be repossessed. I have been having to have to make the payments on the bike since that phone call with the manufacturer, not to mention pay for the higher interest rate because of him not making a payment. Can I put a lien on him for any of the amount of the bike that I still owe on it? Or any other legal action against him?
- boiler23
My father passed away 2 years ago. He was on medicaid. Now medicaid has a lien on my mother's property. My husband and I would like to purchase this property and build a small house on it to be closer to mom in case she needs assistance. Do we need to get a loan to pay off the medicaid lien AND the the 2nd mortgage? I assume medicaid gets their money first. Any suggestions would be welcome.
- tacunni
In 2004 I sold my house through a Real Estate Agent and Title company. A title search was completed by this company. Today I receive a letter from a collection agency stating that I owe a debt to the Department of Housing and Urban Development from back in 2001. Shouldn't this have been taken care of at the sale of the property. I also show that I had Title insurance on this.
- anon6772
I'm looking to buy my first home within the next year. I recently got married. My credit is good, and I have a good job. However, my husband's credit is not so good, but he has a good job also. He owes money for federal income taxes. He is self employed, and his taxes are not done correctly. Can I finance a house in just my name without his name being on the deal? I believe putting him on the deal will not be a good idea. I don't want any liens put on the house for taxes he owes. How would this work and what are my options?
- tonBjackson
I was awarded home in my divorce three years ago. I have not been able to refinance and have ex wife taken off the title and loan because of my poor credit. Now my ex wife claims that an attorney has advise her that she can place a lien on the property. Want to know if this is true and if so what can I do to stop this.
- anon5289
I performed work on a Parade of Homes winner, my payment terms are Due Upon Receipt. They paid for the rough in but not the final. Long story short, I filed a small claim in NC courthouse & the court date wasn't for 2 months. I'm now approaching the court date & found out by the tax records, this house sold a month ago. I'm told the lien wouldn't be put on the house until the court date. So my question is: What recourse do I have when I filed a small claim against the contractor for non-payment & the house sold before the court date. Is there a possibility of still collecting or how does this work?
- fccllc
My wife and I have been making the payments on my father's property since he died in Dec. 2006. I have 5 siblings and only one of them has helped to make the payments. My wife would like to put a lien on the property to protect our interests and make certain we will receive all our money back after the sale of the property. How do we go about doing this? The land is in Pima County, AZ. We already have an affidavit of succesor for my siblings and I.
- anon1699
|
Written by
Sherry Holetzky
copyright © 2003 - 2009
conjecture corporation
