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Pay off or deduct it from the income

by | Jun 29, 2025 | Real Estate | 0 comments

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Whether the reason is no tax payment, unpaid a maintenance fee or unpaid contractor bills, homes with lien are sold, adding a wrinkle to an already complex home sales task.

But don’t worry. “In 10 points, there are nine times when the lien can be paid off by selling,” said Homelight mortgage expert Richie Helali. “In this way, the seller does not need to file (debt) in advance.” In other words, the proceeds from the sale can be used to pay unpaid bills.

In this guide, we will introduce you to all information about selling a home with a lien and the steps to take to close the ceremony.

Emphasize the use of lien to sell a house?

Sometimes the easiest way to sell a home with a lien is to get a cash offer from investors who are familiar with the process of solving the title problem and can get you done. By taking the next step by providing some information through our simple sales platform, we will show you some potential options.

Can you sell a lien?

Homeowners can sell lien. In order for the Buyer to own the property, the Seller will be required to clear the title and satisfy all outstanding lien.

Stephen Donaldson, real estate attorney and founder of Donaldson Law Firm in New York, explained that creditors recorded lien at the county clerk’s office to protect their interests. “The lien brings the world aware of the creditor’s interest in the property.”

“If the owner tries to sell the home, the ownership search will determine any lien to the property. To make the sale, the title company ensures that any lien is met when closed so that the buyer can obtain ownership for free and clear any lien.”

The following payment methods are worth considering clearing your title:

  • Debt advance payment
  • Negotiating debts with lower burdens
  • Dispute debt errors with the assistance of a lawyer
  • Pay the return to sales proceeds

Property Lien Type

Property lien may be voluntary or involuntary. For example, a mortgage lien is voluntary; the borrower agrees to record his property as a lien as collateral for the loan. Other liens are involuntary; they are recorded by creditors or plaintiffs, who have won the judgment of outstanding debts.

Mortgage Lien

The most common type of property lien is mortgage. A mortgage lien usually has two levels or priority: primary and secondary.

Main lien: The first mortgage is the main lien. “Mortgage lenders always want to make sure they have a primary lien,” Donaldson said. “If a homeowner defaults, the lender wants to make sure they get as much money as possible first without considering a second lien holder.”

Secondary lien: If the homeowner has taken out a record of the mortgage purchase of the home, they already have some equity in the home and may wish to borrow that equity from the same or other lender in the form of a second mortgage, or equity in the form of another lender.

“To obtain a household net worth line of credit, the lender will place a lien in a second position or a second priority lien,” Donaldson said.

Tax lien

When a homeowner owes taxes, the government has the right to record the tax lien on the property. To remove the lien, the property owner will need to meet the debt. Homeowners can also seek help from real estate attorneys to negotiate or challenge lien.

Tax lien usually takes precedence over all other lien, including primary mortgage lien. This is part of the backdrop of most mortgage lenders, including property taxes in mortgage plans and pay taxes on behalf of borrowers through escrow accounts – it helps reduce risks and protects lenders’ interest on property.

The federal government also has the right to file an IRS lien to owners who fail to repay their earned income tax. When an IRS lien is not paid, the federal government can cancel the property to collect debts. It is also important to note that states and local governments can also impose lien on non-payment of state or local taxes and taxes.

Judgment lien

When a judge makes a judgment against the owner of the property who loses the lawsuit and the court orders compensation, the judgment lien or judicial lien will be recorded on the real estate. The sale of a home with a lien requires court approval.

Child support and lim maintenance

If the owner of the property fails to pay the lim or child support as ordered by the court, a lien may be placed on the property. The judge can allow the owner to sell the home – however, the court’s approval can take a long time.

HOA Lien

Homeowners Association can record lien for unpaid dues and unpaid fines. Even if state and association covenants, conditions and restrictions allow mortgage payments, HOA may initiate foreclosure.

Mechanical lien

Mechanical lien (also known as building lien) can be targeted at property records for unpaid construction work, starting from 90 days after payment. Like other liens, mechanical liens can blind the title and therefore it is difficult to sell property. Liens belonging to a wider range of mechanical liens include:

  • Lien of material or supplier: For contractors providing materials for construction or home renovation projects
  • Designer link: Recorded by engineers, architects and other designers when services remain free of charge

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