A lien is a legal claim against your property. It enables creditors to have a stake in your home, and gives them a way to collect any debts owed to them. When purchasing a property it’s important to be aware of liens — liens can hurt your ability to sell in the future, and may cost a lot of money to get resolved.
How Do I Find Out if There Are Any Liens on a Property?
If you have the name of the property owner or its address you should be able to search the county recorder, clerk or assessor’s office online. If the data isn’t available online for the property, you will need to visit the county recorder, clerk or assessor’s office in person. The people in these offices can be very helpful, and will likely give pointers if you need help. You can also get in touch with a title company. Title representatives can assist you in finding liens and advise you on how to handle them. If you are investing in real estate, a title representative is someone you should definitely have on your team.
Types of Liens
There are two types of liens. The first is a voluntary lien that the homeowner agrees to, like a mortgage. This typically involves a contract to place a voluntary lien on the property, and it will not negatively affect the property, its title or the homeowner’s ability to convey title. Involuntary liens, however, are placed on a property as a result of unpaid obligations such as a tax bill or home improvement invoice. Although titles can be conveyed without all liens being paid, typically retail buyers won’t purchase a property without a clear title, and no lender would approve the purchase.
If the Property You Buy Has a Lien
It’s a good idea to have any liens removed when purchasing a property. Liens are the responsibility of the seller and they should have them paid off before you proceed with closing. When the amount of liens exceeds the home’s equity, a seller will find themselves in a foreclosure or short-sale situation. In that case, the creditors must accept less than they are owed or the buyer will have to pick up some of the costs.
Get in Touch with Colony Title Today
At Colony Title, we’ll make sure you don’t run into any complications with your property’s title and help you find cost effective solutions. Specializing in real estate title insurance in Maryland and DC, our agents will perform a title search, check all past documentation, and seek to uncover any fraud or forgery associated with the title. Protect yourself from legal intervention caused by property disputes and call Colony Title today!
If you have questions, the Maryland real estate insurance experts at Colony Title Associates can be reached by calling 410-884-1160 or visit ColonyTitle.com today!