Can A Lien Be Placed On My Property Without Notice?

Are you worried about a lien being placed on your property without your knowledge? Or, worse yet, have you attempted to sell a property only to find out that a lien had been placed on it months ago and no one bothered to notify you? While it’s unlikely that just anyone can put a lien on your home or land, it’s not unheard of for a court decision or a settlement to result in a lien being placed against a property. To avoid that situation, let’s take a look at what kinds of events can lead to a lien and how you can fight them.

What Is a Lien?

First, you should have a clear idea of what a lien is. In simple terms, a property lien is something a creditor can attach to a property title that says you owe them money. Until you pay that debt, your title won’t be considered clear, which means you can’t refinance or sell your property. There are two types of liens:

• Voluntary liens are contracts between a creditor and a debtor, such as a mortgage
• Involuntary liens are imposed by law when, for example, a debtor falls behind in tax payments

Involuntary liens can happen without notice depending on the situation. Most commonly, a creditor will place a lien against your property after it sues you and wins the case. This is known as a judgment lien.

Judgment Liens

The creditor can use a judgment lien on your property to ensure they receive the money they won in a suit against you. After a creditor wins a lawsuit against a debtor, the court can grant it a certificate of judgment that can be given to a land records office in the county where the property is located. While no formal notice may be given to you, you should always consider it a possible outcome following a court case with a creditor.

What Can Happen?

A property lien will remain in effect until you pay off your debt to the creditor or if the judgment expires. In some cases, a creditor may decide to request a writ of execution and foreclose on your property. However, except for tax liens, creditors usually forego foreclosure in favor of waiting to collect until your property is sold.

Because mortgage payments are typically placed on properties before liens, those payments have to be made before the liens are paid. So, if a creditor forecloses, they have to continue making payments on the property or lose it altogether.  Instead, a creditor may choose to collect what’s owed to them when you sell the property. Buyers won’t usually buy a property without a clear title, so you would need to pay off your lien before being able to sell.

Check for Property Liens

If you’re worried about a lien being placed against your property without your knowledge, you can check to make sure that hasn’t happened since most property liens are public records. Your city or county recordings office should have the information you need.

How to Help Prevent and Fight Against Liens

If there’s any possibility that a creditor could try to place a lien against your property, be ready to fight. Document every aspect of your conflict with them: letters, phone calls, emails, etc. Although it’s not always possible to easily clear up debt, try your best to straighten it out.

Should you receive notice that a creditor is seeking judgment against you, don’t brush it off. Respond in writing and show up to any court dates with an attorney and documentation of your financial situation. If the ruling is not in your favor, keep your ear to the ground in case the creditor decides to create a lien.