When you buy a home or property, you need to have a title search performed. The title search makes sure that the home is available for purchase and lets you know if there are any liens or other clouds to be aware of.
If you are planning to sell a home, you have an option available to you to find out if any liens are on the property, too. In fact, finding out about a lien is easy, because liens are public record.
What kinds of liens are usually on properties?
There are four general categories of liens that may be on your home. These include:
- Consensual liens such as mortgages which result from a debt owed to a bank when the property was purchased
- Tax liens from failing to pay property taxes or federal, state or local income taxes
- Judgment liens, which are placed if you lose a court case and owe money to another party
- Contractor or mechanics’ liens, which are issued when homeowners, or sometimes contracting companies, fail to pay others for their work on the property
If any of these liens come up, it’s important for you to take action to clear them. In a home purchase, you may ask the seller to clear the liens before continuing with the purchase. If this is your home, you have the option of investigating the lien and paying it off, if necessary.
Is it possible for a lien to be filed incorrectly?
Yes, it’s possible that a lien could be filed against a property even if a debt was paid. Sometimes, paperwork gets crossed or liens aren’t removed when they should be.
If this is the case, the property owner, whether it’s you or someone else, will need to talk to the county clerk to try to get the issue resolved. Keeping receipts for payments to contractors or others to whom you owe a debt is essential, so you can prove that those debts are not owed.
If you find out that there is a lien on a property through a lien search, it may be time to look into how to address the lien legally. With the right help, you may be able to get it removed and continue with the sale or purchase of the property.