What happens when no court action is filed on a lien?

If no court action is filed by that time, the lien is no longer valid. However, many title companies don’t recognize this fact and require that liens be removed before you can pass a clear title to a buyer.

Can a county clerk file a lien on your property?

However, they can file a lien on your property in the office of the county clerk. Typically, this would cause a dispute between you and your general contractor, and you would try to force the contractor to pay off the lien. But meanwhile, this lien (sometimes called a “mechanic’s lien”) represents a cloud on your title.

Can a judgment lien be placed on a primary home?

You face another potential limitation if you attach a real estate lien to the debtor’s primary home. In most states, when a sale of property is forced to pay off foreclosed mortgages or judgment liens, the law provides homeowners with the right to protect from collection a portion of the equity in their residence.

Who is responsible for paying off a lien on a property?

The bank, of course, retains ultimate legal ownership of the property until the loan is paid off. Voluntary liens like mortgages are easily found and quantified; after all, you are most likely the person who agreed to its terms.

What do you need to know about filing a lien?

Filing a lien is a public declaration that someone hasn’t paid for contract work, and is a strong legal move to make. Before you jump straight to the decision that you want to file a lien, talk to the property owner and attempt to set up another plan. Be clear from the beginning of a job that you’ll file a lien if debts remain unpaid.

What happens if you default on a property lien?

If the creditor has a lien, if you default on the terms of the agreement (for example, don’t pay your mortgage), the creditor may take action to foreclose on the property you pledged as a security interest. The creditor must perfect the property lien.

Who is notified when you file a lien on a property?

Notify all necessary parties. In most states you must notify the property owner immediately after you file the lien. Some states require additional parties, such as other lien holders, to be notified as well. You can find out who must be notified when you file the lien.

How to get a judgment lien released or extinguished?

Ways to Get a Lien Released or Extinguished 1 Paying off the debt. If you pay off the underlying debt, the creditor will agree to release the judgment lien. 2 Asking the court to remove the judgment lien. Most states provide a process by which you can ask the court to remove a judgment lien. 3 Filing for bankruptcy.