Lien
A lien is a legal claim against a property that gives a creditor the right to the property if the debt is not paid. Your mortgage creates a lien on your home — the lender can foreclose if you default. Other common liens include property tax liens, HOA liens, and mechanic's liens from unpaid contractors. A clear title (no unexpected liens) is required for most home sales.
Liens are filed with the county recorder's office and become part of the public property record. When a home is sold, a title search uncovers all recorded liens. Any outstanding liens must be paid off at closing or the sale typically cannot proceed — the lender requires clear title as a condition of issuing a new mortgage.
Liens are prioritized in order of recording date (first in, first out) with some exceptions. Property tax liens typically take priority over all others regardless of when they were filed. A first mortgage lender has priority over a second mortgage lender. Understanding lien priority matters in foreclosure: if a property sells for less than what's owed, senior lienholders are paid first.
Mechanic's liens are filed by contractors, subcontractors, or suppliers who weren't paid for work on the property. If you hire a contractor who doesn't pay their suppliers, those suppliers can file liens against your property — even though you paid the contractor. Title insurance protects you against undiscovered liens and title defects.
Key Takeaway
A lien is a legal claim against a property that gives a creditor the right to the property if the debt is not paid. Your mortgage creates a lien on your home — the lender can foreclose if you default. Other common liens include property tax liens, HOA liens, and mechanic's liens from unpaid contractors. A clear title (no unexpected liens) is required for most home sales.
Related Terms
Frequently Asked Questions
Yes. Your mortgage (or deed of trust) gives the lender a security interest in the property — a lien that allows foreclosure if you default.
A title search by a title company or real estate attorney will reveal all recorded liens. This is a standard part of every real estate transaction.
Generally yes, but liens must typically be paid off at or before closing. The proceeds from the sale are used to satisfy outstanding liens.
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