How To Find Out If There Is a Lien on a Property Before You Buy

Maybe you found the perfect property and want more information on its history, or you heard about an investor getting burned by property liens in the past. Whatever the reason, knowing how to find out if there is a lien on a property (whether you’re interested in residential or commercial real estate) can save you a lot of time and trouble. 

A lien is any legal claim on the title of a property made by another party. These occur when payment for a service or outstanding loan goes unpaid, and may be more common than you think. 

In 2021, 71% of contractors filed liens over non-payment – and that’s just for renovation work. It doesn’t include the existing liens for failure to pay income tax, utilities, or estate tax. Until you know how to check for liens on property, you may run into some trouble when purchasing property with unknown liens.

Table of Contents: 

What Is a Lien Search

A lien search uncovers any liens on a property and typically occurs during the selling process. If you purchase a property with liens, it then becomes your responsibility to remove the liens from the title – often by paying the outstanding fees. This is why it’s critical to understand any such nuances associated with your properties of interest.

There are four main categories of liens that are used to further describe the multiple types of liens. These categories include general, specific, voluntary, and involuntary.

  • General: These liens apply to all of the assets owned by the debtor, including their home, investment properties, bank accounts, and more. 

  • Specific: Specific liens only apply to one asset, so if the payments on an investment property default, the lender can place a lien on the investment property, but none of the debtor’s other assets. 

  • Voluntary: Property owners are able to accept or reject such liens. 

  • Involuntary (or adverse): A lien is placed against the property owner’s wishes. More liens are involuntary than voluntary. 

Types of liens include: 

  • Judgment lien: General lien that can be voluntary or involuntary and is utilized when a debtor fails to repay their debt. 

  • Mortgage lien: Specific and voluntary lien issued when debt is accepted to purchase a property. 

  • Mechanic’s lien: Specific and involuntary lien placed on a property when the owner fails to pay for remodeling or renovation work. 

  • Municipal utility lien: Specific and involuntary lien issued when a property owner fails to make utility payments for things like water and electricity. 
  • Attachment lien: Specific and involuntary lien that prevents the owner(s) from selling the property during a legal proceeding, such as a divorce.
     
  • Federal tax lien: General and involuntary lien used when a property owner fails to pay income tax or property tax.

How to Find Liens on a Property

There are a few different ways to find liens on a property. The method you choose will depend on convenience and time. However, property ownership is on public county records, so checking multiple places may not be necessary unless you believe there may be an error on a particular record.

Lorem ispum dolor sit umit

note-image
Tip

If you frequently invest in different properties, purchasing a subscription to an online lien search site can make the process of finding existing liens much faster.

  • Taesent tincidunt vehicula ante, sed tempus libero vulputate.
  • Lorem ipsum dolor sit amet, consectetur adipiscing elit.
  • Taesent tincidunt vehicula ante, sed tempus libero vulputate.
  • Lorem ipsum dolor sit amet, consectetur adipiscing elit.
note-image
Notes

Lorem ipsum dolor sit amet, consectetur adipiscing elit. Proin interdum dolor a ullamcorper molestie. Vivamus in justo velit. Aliquam vehicula massa et venenatis placerat.

Let's connect Join the Revolution

Apply Now
note-image
Notes

Lorem ipsum dolor sit amet, consectetur adipiscing elit. Proin interdum dolor a ullamcorper molestie. Vivamus in justo velit. Aliquam vehicula massa et venenatis placerat.

Lien Search on Property

Several online lien search tools exist to help you find existing liens on real estate property. Keep in mind that some of these sites offer premium subscriptions for several searches. If you purchase properties frequently, it may be worth investing in a premium plan so you can do several title searches at a time. 

Some online lien search tools include: 

Check Records

Property ownership and much of what comes with it – liens, deeds, mortgages, etc. – is publicly recorded and maintained by county clerks and local tax assessment offices. To conduct a property lien search by address, you can look directly on your county’s database. 

To locate a county database with property records, input the following in a Google Search: “[County Name] + property owner records.”

Talk to an Agent

Title agents and real estate agents may also have the means to help you perform a lien search on property. If you’re not working with a buyer’s agent, you can still learn about liens on a property from the seller’s agent. Involuntary liens on property can alter resale values, making it crucial for seller’s agents to know what liens exist on every property they help sell.

Revolution Realty Capital doesn’t just offer investment loans in 42 of 50 states, we’re also a group of real estate professionals with a combined 40+ years of experience. Our private lending platform tied with our expertise can help you maximize your profit and navigate purchasing properties with real estate liens.

Buying Property With Liens

Sometimes, the investment opportunity is too good to pass up – even if there are existing liens on the title. If this is the case, there are few things you need to do before buying property with liens.

Step 1

Check for structural problems: You should do this with any property you’re interested in purchasing – lien or not. However, liens add another layer of complication so the last thing you’ll want is to deal with structural issues as well (especially if you become responsible for paying off the lien).  

Step 2

Find the price of the lien: Knowing the price of the lien can help you determine if the property is worth it or not. You can find the payoff price of the lien from the lending company that issued the lien. 

Step 3

Pay the lien: In some cases, property sellers may be able to include the price of the lien in the purchase price of the property. You’ll need to work closely with both the seller and the seller’s lender to pay the full price of the lien.  

Step 4

Communicate with the title company: Depending on how the lien is set up, the original lender may not allow the debtor to sell the property until the lien is paid off. In this instance, the title company would work with the lender to determine what options are available to the seller.  

 

In some instances, the process of buying property with liens may become a short sale. When the property owner owes more than the home is worth, the title insurance company may work with the lender to allow the owner to sell the property for less than it’s worth. 

Property liens can make the transition of property ownership more complicated, but not impossible. Now that you know how to find out if there is a lien on a property, if you’ve found a property with profit-generating potential and one or more liens, reach out today. We can help you secure the funds you need through bridge financing and provide advice for moving forward with your purchase.

column-icon-image
Taesent tincidunt

vehicula ante, sed tempus libero vulputate.

column-icon-image
Taesent tincidunt

vehicula ante, sed tempus libero vulputate.

column-icon-image
Taesent tincidunt

vehicula ante, sed tempus libero vulputate.

column-icon-image
Taesent tincidunt

vehicula ante, sed tempus libero vulputate.

post-inner-image

Key Takeaways

Adipiscing elit. Proin interdum dolor a ullamcorper molestie. Vivamus in justo velit. Aliquam vehicula massa et venenatis placerat. In hac habitasse platea dictumst. Maecenas scelerisque ipsum et mauris aliquam, eget rhoncus enim facilisis. Praesent tincidunt vehicula ante, sed tempus libero vulputate at. Proin sed erat neque. Vivamus faucibus magna at facilisis suscipit.

  • Taesent tincidunt vehicula ante, sed tempus libero vulputate.
  • Lorem ipsum dolor sit amet, consectetur adipiscing elit.
  • Lorem ipsum dolor sit amet, consectetur adipiscing elit.
  • Taesent tincidunt vehicula ante, sed tempus libero vulputate.
quoet-image

Proin interdum dolor a ullamcorper molestie. Vivamus in justo velit. Aliquam vehicula massa et venenatis placerat. In hac habitasse platea dictumst. Maecenas scelerisque ipsum et mauris aliquam, eget rhoncus enim facilisis. Praesent tincidunt vehicula ante, sed tempus libero vulputate at. Proin sed erat neque.”

note-image
Notes

Lorem ipsum dolor sit amet, consectetur adipiscing elit. Proin interdum dolor a ullamcorper molestie. Vivamus in justo velit. Aliquam vehicula massa et venenatis placerat.

Other Categories

Recent Posts

Real Estate Investing

Motivated Seller: How to Find and Land Leads in 2022

See More
Long Term Rental

Multifamily Real Estate Investing: Pros, Cons, and Strategies

See More
Ground Up Construction

How To Qualify for Hard Money Loan: 6 Requirements

See More

Let’s connect Join the Revolution