One of the most common reasons for a home sale to fall through is the
presence of property liens. Often the sellers are not even aware they have
a lien on their home and the delay caused by having them removed can
cause a qualified buyer to look elsewhere.
Along with other pre-listing tasks, such as repairs and curb appeal projects,
sellers should order a title search to determine if any liens are on the
property. Some liens are expected, such as the mortgage lien which
ensures any home loan is paid off at the time of close, but others might
come as a surprise. Here are a few liens which can derail your closing.
· Mechanics Lien – A contractor may place a mechanics lien on your
home to make sure they are paid after a home project.
· Divorce Lien – Even if you and your spouse have agreed on the sale
of the home, the court may need to approve the sale before the lien can be
· Homeowner’s Association – Past due HOA payments and
assessments can lead to a lien on the home.
· IRS and Property Taxes – A government legal claim against your
property when you neglect or fail to pay a tax debt.
· Judgment Liens – Is a court ruling that gives a creditor the right to
take possession of a debtor’s real or personal property if the debtor fails to
fulfill his or her contractual obligations.
· Credit Card Liens – If you default on a credit card and the issuers
get a judgment, they can attach a lien to your property.
Liens must be dealt with before a home can change title. Often the
lienholder will negotiate the payment, but others will want full payment
before releasing the hold. Either way, dealing with liens can take time and
money. It’s always best to remove liens before listing your home for sale.