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Selling a house can be a complex and overwhelming process, and it becomes even more challenging when there's a lien on the property. Understanding what liens are and how to navigate them can make selling your home go smoother. If you find there is a lien on your property, don’t panic, we’ll walk you through what you need to know.
After over 15 years of being in business, we’ve seen it all and want to help you navigate this situation by providing you with expert advice and how you can still sell your home.
What is a lien?
A lien is a legal claim placed on a property by a creditor to secure the payment of a debt. It is filed with a county records office and can become viewable by the public. Having one on your house can raise questions like, “Can I sell a property with a lien?” and what steps need to be taken to address it. Let’s take a closer look at how you can sell your house if it has a lien…
Understanding Liens On a House
A lien on a house can arise due to various reasons, but they typically fall under two categories:
1. Voluntary Lien:
- Mortgage: Homes that have mortgages have this type of lien on the home until the home is paid off. Anyone with a house mortgage has a lien.
- Mechanical: A mechanical lien is placed on your home by a contractor who is seeking compensation for work done to your property.
- UCC: UCC (Uniform Commercial Code) liens are placed on a house when a financial entity uses the property as collateral for a business.
2. Involuntary Lien:
- Tax: Tax liens are for owed property taxes. This will be placed on your home to ensure payment is prioritized.
- Judgment: A judgment lien is awarded by a court to someone you owe money to.
- HOA: If HOA fees are unpaid, the HOA has the right to collect their dues by placing a lien on the house.
For more information about how they can affect house sales, see our article What Types of Liens Affect the Sale of My House?
When a lien is placed on a property, it becomes encumbered, meaning that the creditor has a legal right to seek repayment from the proceeds of the property's sale, if necessary.
How Can I Tell If There’s a Lien On My House?
The most common way to know if you have a lien on your property is by being notified via mail or from the outcome of a court proceeding. However, you might have a lien on your home and not even know it. Not to worry! You can easily find out by contacting the county clerk or recorder. Most Texas counties provide an easy online way to check by entering your address on the county’s website. For example, to find properties with tax liens on them, you can go straight to the Texas Department of Housing and Community Affairs website.
Do Liens Ever Expire?
Every state has different laws for the statute of limitations for a lien. Even if it expires, in most states, creditors can re-file the lien to extend it.
What Should I Do If I Find a Lien On My House?
If there is a lien on your Texas property and you are wanting to sell, you have options. We know, you’re probably still wondering, “Can a house be sold with a lien on it?” The short answer is yes. Here are some of your basic options:
- Find out if the lien has been paid. It is possible that the lien was paid but the creditor failed to file a release. If you can prove it was paid, you can contact the lien holder and request a release. Once you obtain the release of lien, you can record it with the county clerk.
- Locate a qualified buyer. You can sell your property “as is” and pay the debt at closing. It is important to note that the Title Company does a lien search when you go to sell a house, and in order to issue a clear title policy, there cannot be any outstanding liens on the house. The Title Company will order the payoff of any outstanding liens and they will pay the lien from your proceeds at closing.
- Negotiate the lien. Some creditors who go to the length of placing a lien on a property are also willing to negotiate for a partial payment of what they are owed.
- Let an expert help you. An expert makes an important difference in the result. An experienced investor or title company can guide what you say to creditors when settling liens. It’s often best to not tell the lien holder that you need to release to sell a house because that gives them the upper hand. Other times, you do want them to know this information because they will wait for the settlement payment, knowing it will come from closing proceeds. If you don't have experience negotiating liens you may say the wrong thing to your creditor so it's important you work with the right professional. At Big State Home Buyers we negotiate and settle all liens for our customers as part of the title curative process.
Can You Sell a House with a Lien on It?
Yes, you can, but the process is complex and stressful, especially when your emotions are involved.
The trick is knowing how to negotiate the payment of the lien. You might not be in a financial position to pay off a lien on your home, and unless you find the right title company, you might not be able to negotiate the best deal either. If you feel stuck but really want to sell your Texas home, we’re always happy to help. We understand how stressful it can be to be in financial hardship, feel stuck in your home, and feel like you have no options. We want to help you get to the next step on your journey and, hopefully, into a better situation.
Selling a House With A Lien With Our Experts On Your Side
Creditors know that most people misunderstand their rights and options in resolving a lien. When you have an expert on your side, creditors are much more likely to negotiate.
Texas homeowners are fortunate to live in a state with access to services from reputable real estate experts like our team at Big State Home Buyers. When you choose to sell your house with a lien with us, you can benefit in the following ways:
- Fast and Hassle-Free Sale: Big State Home Buyers is renowned for its quick and efficient home-buying process. We understand the urgency of selling a property with a lien and can close the deal in a matter of days, saving you time and stress.
- No Need to Settle the Lien: Unlike traditional buyers, Big State Home Buyers can help sell your property for cash as-is, meaning you won't have to deal with the lien alone. We will handle the lien and other necessary paperwork, simplifying the selling process for you.
- Fair Cash Offer: We will make a fair cash offer for your property, taking into account its condition and current market trends. This offer provides you with an opportunity to move forward and secure a quick sale, even with a lien attached to your house.
Get a No-obligation Cash Offer On Your House With a Lien
Selling a house with a lien on it is possible, and it can be a smooth process when dealing with a reputable cash home-buying company like Big State Home Buyers. Whether you decide to pay it off or sell directly to a company like Big State, you have options to move forward with the sale and alleviate the burden of a lien-encumbered property. If you find yourself in such a situation, consider reaching out to us for a hassle-free and efficient solution.Get Started Today!