A property lien is a financial claim (or a hold) against a property, that must be repaid before the property can be sold.
Simply put a lien is a claim against a property that ensures a debt or other obligations are either paid or met, this can include supplies and services to contractors as well as subcontractors for work rendered on your property.
What is a lien release (lien waiver)?
A lien release (lien waiver) is when a lien holder (someone that has put a lien on a property) has lifted or waived the lien, signaling that the property is free of debt and is now free to be sold.
In cases such as a mechanic’s lien (construction lien), a lien waiver (lien release) can be presented at the time of payment, by either the contractor or the property owner. This ensures that both parties agree that the service has been paid in full and that the contractor waives the right to place a future lien on the property.
Other ways of attaching a property lien
A range of creditors may also have the right to attach a lien to your property if other avenues of claiming a debt are depleted.
When a bank approves a loan for a real estate property, that loan is a form of conditional ownership by your loan provider. Only when the mortgage is paid in full will the lien be released by the loan provider and the property will be yours.
If a contractor or subcontractor has worked on your property or supplied materials for your property, and they have not been paid, a lien can be placed on your property called a mechanic’s lien.
Who can file for mechanic liens against your property?
- Construction companies
Note: This type of lien is not limited to the list above.
Property Tax Liens
If property taxes are not paid, the local government can place a lien against your property until the debt is satisfied.
If you owe back taxes and fail to pay after receiving notice from the IRS, a lien can be placed on your property until the debt is cleared.
Child Support Alimony Liens
If child support or alimony is not paid, the recipient can have the right to place a lien on your property. This lien will stay until the debt is satisfied.
If the judgment is not paid, the recipient can have the right to place a lien on your property.