A property lien is issued when there is debt that hasn’t been paid on a property. It gives the homeowner a legal notice that this third party they owe money to has a claim on a portion of their property. These liens will prevent the transfer of clear and free title to the property. Curious about the different types of property liens? Here are the three main categories that liens fall into:
Mechanical/Contractor Lien: This type of property lien occurs when a homeowner uses a contractor for any form of home renovation or improvement, but doesn’t pay them appropriately. This could be a case where the homeowners didn’t pay the full amount for a project, or simply neglected to pay for the service at all. Sometimes, the contractor will foreclose on the lien they are placing.
Tax Lien: These liens are placed on a property by the county in which the home resides if property taxes are evaded. Tax liens will also be filed by the IRS if the homeowner failed to pay federal taxes. These liens will continue to gain interest until they are paid off in full.
Judgment Lien: A judgment lien will be placed on your property by a plaintiff should you fail to pay any money you owe to another party as a result of a court ruling. Examples of settlements can include any outstanding credit card debt, medical bills, or child support.

How to Find Out If You Have a Lien on Your Property

Title searches can uncover any liens that may exist on a property. You can also find out for yourself by checking through public records. Hiring a professional to do this work for you is smarter, however, since you can trust them to find anything you may miss when searching on your own. If a lien is found, you will have to sort it out before you can move forward in a sale.

Consider Acuity for Title Services when Home Buying or Working with Home Buyers

When you select Acuity National Real Estate Solutions, you’ll work with a national title agency offering cutting-edge tools to streamline your closing so it takes place on time. If you’re a home buyer, lender or real estate agent who would like more information, please contact us today!

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