Liens 101: a Primer on the Various Types of Liens

June 11, 2020

There are many different types of liens, and as a leading title agency we know them all. Liens are a creation of the legislature designed to allow certain ways to secure debts on real estate.

Here’s a brief introduction.

What is a lien?

A creditor mayplace a notice on your property requiring you to pay off your debt before you can sell the property and transfer title to the buyer. Liens are usually placed on real estate, but can also be attached to other personal property.

Judgment Liens

A judgment lien can be placed on your real estate or other property when a creditor files a lawsuit against you and wins the court judgment. Judgment liens vary from state-to-state. 

Other Types of Liens

Creditors can also place a lien on your property without suing you in a variety of different ways.

Property Tax Liens

Regardless of when it was placed, a property tax lien takes precedent over other mortgages or liens on your property. Because the government can sell your property to cover your unpaid taxes, lenders will pay the taxes themselves to protect the mortgage and add it to your debt. You might, however, be able to pay the back taxes and get your property back once “sold.” Procedures vary by state.

IRS Liens

If you receive notice from the IRS and still fail to pay your taxes, it can place a lien on your property, especially if they cannot garnish your wages due to unemployed or sporadic employment. The IRS tends to act swiftly and can force a sale of your home if you owe a significant amount.

Mechanic’s Liens

If you hire a contractor and don’t compensate him or her within one to six months, the contractor canplace a lien on your property. The contractor can also sue you to enforce the lien within one month to six years, and potentially force the sale of your property. Procedures vary by state.

Child Support Liens

A recipient of alimony or child support from you may put a lien on your property until you pay what you owe, sell or refinance your real estate, or the recipient forces a lien sale. 

Family Law Real Property Lien

In some states, such as California, a spouse may file a lien against his or her community real estate interests to pay attorney fees in a marital action. 

Meet Lakeside Title 

Now that you know the different types of liens, it’s time to learn how to protect yourself and your clients from other unnecessary risks. Lakeside TItle  is a title agency that has been clarifying legal and financial risk for its clients for over a decade. We perform on-site search and retrieval of a variety of documents including bankruptcy, civil records, UCC, judgments, and recorded/unrecorded liens.

Visit our homepage to learn more!