How to Check for Liens on Property: A Guide

Thinking about buying a house or selling your current property? If so, don’t forget to check for liens. As cash home buyers in Tennessee, we at Nexus Homebuyers know how important a clear title is. In this guide, we’ll walk you through everything you need about property liens and how to check for them.

What is a Lien?

Before we get into how to check for liens, let’s start with the basics. A lien is a legal claim against a property that must be paid off when sold. Think of it as a “hold” on your property that gives someone else the right to keep it until you pay a debt. Liens are essentially a way for creditors to get paid what they’re owed.

Types of Liens

Several types of liens can be placed on a property:

1. Mortgage Lien: This is the most common type of lien. When you take out a mortgage to buy a house, the lender puts a lien on the property as collateral for the loan. This lien gives the mortgage lender a legal interest in the property until the mortgage is paid off.
2. Tax Liens: If you don’t pay your property taxes, the government can put a tax lien on your property. This includes local property tax liens and federal tax liens. A federal tax lien is a legal claim the government can assert against an individual’s property due to unpaid tax debts. These liens take priority over most other types of liens.
3. Judgment Liens: These are filed when a court rules against the property owner. For example, if you lose a lawsuit and are ordered to pay damages, the plaintiff can file a judgment lien against your property.
4. Mechanic’s Liens: These are filed by contractors or subcontractors who haven’t been paid for work on the property. Material and equipment providers can also file mechanic’s liens if they’re not paid for supplies used in home improvements or construction.
5. Child Support Liens: In some cases, unpaid child support can result in a lien being placed on the property of the person who owes the support.
6. Homeowners Association (HOA) Liens: If you don’t pay your HOA fees, the association can put a lien on your property.
7. Involuntary Liens: These legal claims can be placed on a debtor’s assets due to various reasons, including unpaid taxes. Unpaid taxes can lead to lienholders legally seizing assets if debts are not settled.

Why Check for Liens?

You should check for liens for several reasons:

1. No Surprises: Discovering a lien during a property transaction can cause delays or even kill the deal. A lien search can prevent these surprises.
2. Protect Your Investment: As a buyer, you want to make sure you’re not inheriting someone else’s debt. A property with liens can come with big financial obligations.
3. Clear Title: A property with liens doesn’t have a clear title which can affect your ability to sell or refinance in the future. A clear property title is required for any real estate transaction.
4. Legal Requirement: In many cases, liens must be paid off before a property can be sold. Knowing what liens exist is important for both buyers and sellers.
5. Negotiating Power: If you’re buying a property knowing what liens exist can give you bargaining power.

Property Liens

Before we get into how to check for liens let’s go a bit deeper into understanding different types of liens and what they mean.

Voluntary vs. Involuntary Liens

Liens can be either voluntary or involuntary:

1. Voluntary Liens: These are liens that the property owner agrees to. The most common example is a mortgage lien. When you take out a mortgage you’re voluntarily allowing the lender to put a lien on your property as collateral for the loan.
2. Involuntary Liens: These are liens put on the property without the owner’s consent. Examples are tax liens, judgment liens, and mechanic’s liens. These are usually the result of unpaid debts or legal judgments against the property owner.

Lien Order

Not all liens are equal. There’s an order of liens known as “lien priority.” This determines the order in which lienholders are paid if the property is sold or foreclosed upon. Generally, the order is:

1. Property Tax Liens
2. Federal Tax Liens
3. Mortgage Liens
4. Judgment Liens
5. Mechanic’s Liens

Knowing lien priority is important because it affects the rights of different lienholders and can impact the sale or refinance of a property.

Check for Liens on a Property

Now that you know what liens are and why you should check for them, let’s look at how you can check them. Homeowners may need to interact with the county clerk’s office to address incorrectly filed liens or to confirm the status of a lien that may have already been cleared. Additionally, individuals can contact their local county recorder for assistance in searching local government records to determine any liens associated with a property. There are several ways to do a property lien search.

1. Search Local Government Records

One of the most direct ways to check for liens is through local government offices. Here’s how:

County Recorder’s Office

The county recorder’s office (sometimes called the Register of Deeds office) keeps records of all documents related to real estate transactions including liens. You can usually search these records online or visit the office in person. Here’s what you need to know:

• Bring the property’s legal description or parcel number for the most accurate search.
• Be prepared to pay for copies of documents.
• Some counties have digitized their records so you can search online.

County Assessor’s Office

While primarily responsible for property tax assessments the county assessor’s office may also have information on tax liens on a property. They can provide:

• Current and past property tax payments
• Outstanding property tax debts
• Potential property tax liens

County Clerk’s Office

Some counties store lien information in the clerk’s office instead of the recorder’s office. Check both if you’re not sure. The county clerk’s office can provide information on:

• Judgment liens
• Pending lawsuits that could result in liens

2. Online Resources

There are several online tools and databases that can help you find lien information:

Property Lien Search by Address

Many websites allow you to search for liens by address. While these are convenient, remember they may not always have the most current information. Here are some popular ones:

• NETR Online: Access to property records in many counties across the U.S.
• PropertyShark: Property reports that include lien information.
• LexisNexis: Lien searches (usually for professionals).

Free Lien Search

Some counties offer free online searches of their property records. Check your county’s website to see if this is available. While these are free they may not be as comprehensive as the paid options.

UCC Lien Search

For personal property liens (like those on vehicles or equipment) you can do a UCC lien search through your state’s Secretary of State office.

3. Check Your Credit Reports

Another effective way to uncover any liens on your property is by checking your credit reports. Public records, including tax liens, can sometimes be reported to credit bureaus and appear on your credit reports. This method is not only free but also relatively quick. You can request a free credit report from each of the three major credit bureaus—Experian, TransUnion, and Equifax—once a year through AnnualCreditReport.com. When reviewing your credit reports, pay close attention to the public records section. Look for any mentions of tax liens or other public records that could indicate a lien on your property. This step can provide an additional assurance that you are aware of any potential legal claims against your property.

3. Work with a Title Company

For the most thorough and accurate results consider working with a title company. Here’s why:

Why Hire a Title Company

• Expertise: Title companies know property records inside and out and can find liens that might be missed in a casual search.
• Comprehensive Search: They search multiple sources to make sure no liens are missed.
• Title Insurance: Many title companies offer title insurance which can protect you from undiscovered liens.
• Legal Knowledge: Title companies understand the legal implications of different types of liens and can explain them to you.

How to Choose a Reputable Title Company

• Experience: Look for a company with years of service in your local area.
• Reviews: Read online reviews and ask for references.
• Licensing: Make sure the company is licensed in your state.
• Fees: While cost shouldn’t be the only factor it’s worth comparing fees between companies.

4. Real Estate Attorney

In complex cases or high-value transactions, it’s worth consulting with a real estate attorney. They can:

• Conduct a title search
• Explain the legal implications of any liens found
• Advise on the best course of action if liens are discovered

6. Conducting a Thorough Lien Search

Conducting a thorough lien search is crucial to ensure you have a complete understanding of any liens on your property. This process involves multiple steps to ensure no stone is left unturned. Here’s how you can conduct a comprehensive lien search:

• Search Public Records: Start by searching public records online or in person at the county recorder’s office. Look for any records of liens, including tax liens and other public records that may indicate a lien on your property.
• Contact the County Recorder’s Office: The county recorder’s office is a valuable resource for information on any liens on your property. You can contact them by phone or visit in person to request a search of their records. They can provide detailed information on any existing liens.
• Use Online Lien Search Services: Several online services can help you search for liens on your property. These services often provide comprehensive reports that include any liens, tax liens, or other public records associated with your property. While some of these services may charge a fee, they can save you time and provide peace of mind.

By conducting a thorough lien search, you can ensure that you have a clear understanding of any liens on your property. This knowledge allows you to take the necessary steps to resolve any issues and protect your investment.

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What to Do If You Find a Lien on Your Property

If you find a lien on your property don’t panic. Here’s what to do:

1. Understand the Lien: What type of lien is it? Who filed it? Is it a tax lien, judgment lien, or mechanic’s lien? Knowing this will help you decide what to do.
2. Verify the Lien: Sometimes liens are recorded in error or have been paid off but not removed from the record. Contact the lienholder to confirm the details.
3. Contact the Lien Holder: Reach out to the person or entity that filed the lien to discuss your options. They may be willing to negotiate or provide a payoff amount.
4. Negotiate: In some cases, you may be able to negotiate a lower payoff amount especially if the lien is old or the debt has been partially paid.
5. Pay the Lien: If the lien is valid and you can afford it, paying it off is usually the quickest way to clear your title.
6. Dispute the Lien: If you believe the lien is invalid or was filed improperly you may be able to dispute it. This usually requires legal assistance.
7. Get a Lien Release: Once the lien is paid or disputed get a lien release document. This is crucial for clearing your property title.

Ready to sell a house without a realtor and avoid the hassle of dealing with liens? Learn more about us and how our process works to see how Nexus Homebuyers can offer you a stress-free way to sell your property quickly, regardless of any existing liens.

Remove the Lien from Your Property

Once you’ve resolved the issue, you’ll need to formally remove the lien from your property records. Here’s how:

1. Get a Lien Release: This is a document from the lien holder stating the debt has been satisfied. Make sure it includes:
   • The property’s legal description
   • The original lien information
   • A statement that the debt has been paid in full
2. File the Release: Take the lien release to the same office where the lien was filed (usually the county recorder’s office). Some points to remember:
   • There may be specific forms required by your county
   • You may need to provide identification
   • Some counties allow you to file lien releases online
3. Pay the Filing Fee: There may be a small fee to file the lien release. Be prepared to pay when you file.
4. Verify: After a few weeks check the property records again to make sure the lien has been removed. If not you may need to follow up with the county office.
5. Update Your Records: Keep a copy of the lien release and any other related documents for your records.

Timeline to Remove Lien

The timeline to remove a lien can vary:

• Type of Lien: Some liens like mortgage liens are removed quickly once paid off. Others like tax liens take longer.
• Local Government: Some county offices process lien releases faster than others.
• Lienholder: If the lienholder is slow to provide a lien release it can delay the process.

Generally, it can take anywhere from a few weeks to a few months. If you’re selling your property make sure to start addressing liens as soon as possible to avoid delays.

How to Avoid Liens on Your Property

The best way to deal with liens is to avoid them in the first place. Here are some tips:

• Pay Your Bills On Time: This includes your mortgage, property taxes, and any contractors you hire.
• Keep Good Records: Keep proof of payment for all property-related expenses. This will help you dispute any wrongly filed liens.
• Communicate with Creditors: If you’re having trouble paying a bill reach out to the creditor to see if you can work out a payment plan. Many will negotiate to avoid the hassle of filing a lien.
• Do Title Searches: Periodically check your property records to catch any issues early. This is especially important if you’ve had work done on your property or been involved in a lawsuit.
• Be Careful with Contractors: Before hiring a contractor check their references and make sure they’re properly licensed. Pay attention to any preliminary notices they file, these can turn into mechanic’s liens if left unpaid.
• Know Your Obligations: If you’re part of a homeowners association make sure you know and fulfill your financial obligations to avoid HOA liens.

Title Insurance

Title insurance can help protect you from unknown liens. Here’s what you need to know:

• Purpose: Title insurance protects the insured party from financial loss due to defects in a property title, including unknown liens.
• Types: There are two main types of title insurance:
  • Lender’s Policy: Required by most mortgage lenders to protect their interest in the property.
  • Owner’s Policy: Optional for the property owner but highly recommended for extra protection.
• Coverage: Title insurance covers:
  • Unknown liens
  • Errors in public records
  • Forgery or fraud related to the title
  • Undisclosed heirs
• Duration: Unlike most insurance policies title insurance is paid with a one-time premium and lasts as long as you or your heirs own the property.

While title insurance can give you peace of mind, it’s not a substitute for doing your due diligence and checking for liens before buying a property.

Tennessee Specifics

If you’re dealing with property in Tennessee here are a few things to keep in mind:

• Mechanic’s Liens: In Tennessee contractors must file a notice of lien within 90 days of the last day of work or delivery of materials. The lien must then be enforced within one year.
• Property Tax Liens: Tennessee allows counties to sell tax liens to third-party investors. This can complicate the process of resolving property tax liens.
• Homestead Exemption: Tennessee’s homestead exemption can protect a portion of your home’s value from certain types of liens but it doesn’t apply to tax liens or consensual liens like mortgages.

Contact a local real estate attorney or title professional for the most current information on Tennessee liens.

Bottom Line

Searching for liens on a property is a must-do in any real estate transaction. Whether you’re buying, selling, or just want to make sure your property has a clear title, taking the time to search for liens will save you headaches down the road.

Knowing how to search for liens, what the different types of liens mean, and how to remove them is valuable information for any property owner. Remember a clear title is key to getting financing, selling your property, and protecting your investment.

At Nexus Homebuyers we know dealing with liens can be stressful. That’s why we have a solution for homeowners who want to sell their houses fast and hassle-free. Our process is to buy homes as-is so you don’t have to worry about clearing liens or making repairs before selling.

If you have liens or other issues that make it hard to sell your house through traditional means we can help. We’ve helped many homeowners in Tennessee sell their houses without a realtor and save time and money.

Ready to learn more? Contact us today to see how we can help you sell your house fast even if it has liens. We’ll walk you through the paperwork to sell a house in Tennessee and make the process as easy as possible. Don’t let liens hold you back from moving on to the next chapter – let Nexus Homebuyers help you find a solution that works for you.

Remember when it comes to property liens knowledge is power. By knowing how to search for liens and what to do if you find them you’re taking an important step in protecting your real estate investments. Whether you’re a first-time homebuyer, a seasoned property investor, or somewhere in between staying informed about liens is key in today’s real estate market.