Real Estate Investing Basics

Property Lien Search: How to Find Out About a Lien on Property

Expertise: Real Estate Marketing, Personal Development, Real Estate News & Commentary, Mortgages & Creative Financing, Real Estate Investing Basics, Landlording & Rental Properties, Flipping Houses, Personal Finance, Business Management
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Awhile back, I remember talking to a friend who wanted to purchase property. He was nervous—this would be his first home. He wanted to know how to uncover any property liens on the home he was considering.

He didn't want any surprises—a lien gives another party a legal claim to the property when it's sold. That's why he needed to do his due diligence. Liens can hinder your ability to sell your property in the future and can cost you a lot of money to resolve. Learning how to perform a property lien search is an essential investor skill.

Read More: Should You Buy Properties With Back Taxes or Liens?

What Is a Lien on Property?

Before digging into the details of lien searches, it’s important to know what a lien is. These are more than simple fees. In short, a lien is a financial claim placed by a person or a company, which prevents you from selling the property outright until they receive their allotted payments.

There are two types of liens that can be placed against a property. A voluntary lien is a lien the homeowner agrees to, like a mortgage. There is usually a contract involved to place the voluntary lien on the property, and it does not negatively affect the property, its title, or the homeowner’s ability to convey title.

An involuntary lien is typically placed on a property due to unpaid obligations like a tax bill or a home improvement invoice, which is sometimes called a mechanic’s lien. These are the liens that affect your ability to sell a property easily—and also are more difficult to discharge from the public record.

When the lien on a house is paid off, the creditor has been satisfied. They wanted payment—once they have it, they can remove the lien. (Will they remove it? Good question. I discuss that more later.)

While title can be conveyed without all liens being paid, most retail buyers will not purchase the property without clear title. Certainly no lender would approve the purchase.

Types of liens

There are a number of different liens that can be placed on a property. Common types include:

  • Tax liens. If you fail to pay your taxes, the federal, state, or local governments can place a lien on your property. This isn’t just for property taxes—a lien can be placed if you fail to pay any taxes.
  • Mortgage lien. These common liens are placed on any property with a mortgage.
  • Mechanic’s lien. Fail to pay for home improvement? Contractors have the right to place this lien on your property, which ensures they will be paid if you attempt to sell or refinance.
  • Judgment lien. If you are party to a lawsuit, lose, and can’t pay damage, this lien can be placed on your property.

Property Lien Search: How Do I Find Out if There Are Any Liens on Property?

Wondering how to perform a property lien search? The answer is pretty straightforward, because liens are a matter of public record. As long as you know the property address, you can learn if it’s encumbered by any liens. Here are your search options:

  • Search the county recorder, clerk, or assessor’s office website. All you need is the name of the owner and/or address to access the property records.
  • Visit the recorder, assessor’s, or county clerk’s office in person. Generally, you will find the people in these offices will be quite helpful, and they can even give you pointers if you need help.
  • Contact a title company. Title representatives can be extremely helpful in many ways—finding liens is one of them. I strongly advise having a good title rep as part of your investing team.

How to Remove a Satisfied Lien

A voluntary lien, like a mortgage, won't cloud your title. The seller's loan is paid off at the closing table, and the lien is released during the closing process.

Government holders of involuntary liens like tax or IRS liens should automatically send you a lien release once the debt has been paid. If you don’t receive one within 30 to 60 days of final payment, contact them to see when you can expect to receive it.

A mechanic’s lien holder or a child support lien holder may not be aware of their obligation to remove the lien or may be under the impression that it will automatically be removed. Ideally, you should make the final payment contingent upon them signing a lien release.

Lien releases must be notarized in order for the county to accept them. With a smaller lien holder, like a contractor, consider meeting them at a bank to make the final payment. Have your bank notarize the lien release, then submit it to your county recorders office to have the lien removed from your property.

Ready to start searching? Find your local real estate public records.

Title Insurance and Property Title Search

If you are getting a mortgage on your property, your lender will require you to purchase a lender's title insurance policy. This protects their interests should there ever be a title dispute. A lender's policy only protects the lender—not the owner of the property. Buyers must purchase owner’s title insurance for their own coverage.

The title insurance policy—whether it be the lender’s or owner’s—only comes after a thorough title search performed by the title company. After the search is performed, a policy is written. The search should turn up any liens on the property, and the insurance policy protects against most liens not found, such as undisclosed heirs, errors, or omissions in transferring deed, as well as forgeries.

Title insurance is a little different from most insurance policies. Other insurance policies protect you against future issues—auto insurance covers damages and losses in potential accidents, for example. Title insurance protects you against past instances that actually have nothing to do with you personally.

Make Property Lien Search Part of Your Due Diligence

Clouds on title pop up unexpectedly. Many times, the cloud is a surprise to the seller, especially if they skipped title insurance when they bought the property.

Even if the sellers did purchase title insurance, it may have missed previous clouds. Computerized county records are still fairly new.

But not everyone is 100% honest all the time. The seller is trying to sell the property, so they may conveniently “forget” about those unpaid taxes. Trust but verify is the best course of action.

A quick property lien search can give you the peace of mind you need. If you find a lien on a property you’re interested in buying, it might be a good reason to skip the purchase—or, at a minimum, hire an attorney to help you determine if the asset can be purchased free and clear.

Have you performed a property lien search? What did that search tell you?

Let me know your comments and questions below!

Joshua Dorkin is a serial entrepreneur, investor, podcaster, publisher, educator, and co-author of How to Invest in Real Estate. He started BiggerPockets to help democratize the real estate investing landscape for himself and others, aiming to make it accessible for everyone, regardless of income or education. Today, BiggerPockets is the premier real estate investing website online with over one million members and reaching over 70 million people with the message of financial freedom through real estate investing. Joshua, along with his wife and three daughters, make their home in Denver, Colorado, and spend any time they can traveling, exploring, and adventuring. Read more about Joshua’s story in 5280 and Inc.com.
    adam
    Replied about 4 years ago
    what percentage of foreclosed properties do you find have liens on them not involving the asking price on the auction? I have done many searches on govt. sites that have revealed no leans and not had a problem. Am I getting lucky?
    Marilyn Sevigny Investor from Colorado
    Replied over 3 years ago
    Has anyone heard about hiring an abstractor that will go and verify title for judgements and liens? A few weeks ago I saw or heard about a company that does this type of service. Unfortunately, I was on the road and didn’t write down the companies name.
    Marilyn Sevigny Investor from Colorado
    Replied over 3 years ago
    Has anyone heard about hiring an abstractor that will go and verify title for judgements and liens? A few weeks ago I saw or heard about a company that does this type of service. Unfortunately, I was on the road and didn’t write down the companies name.
    Mary Criswell
    Replied over 3 years ago
    Why am I just learning 4 days before the close of escrow that there is a lien on the property?
    Jerry W. Investor from Thermopolis, Wyoming
    Replied about 3 years ago
    An old post, but a good post. Title insurance is a must. Like health insurance, it does not put money in your pocket, but it protects you from losing everything in a deal.
    José Rivera Rental Property Investor from Clermont, FL
    Replied almost 3 years ago
    Spot on information, thanks for posting this! I have been researching about lien research, this helps a lot.
    Kathryn Romine Rental Property Investor from Port Orchard, WA
    Replied about 2 years ago
    Lien searches and all Assessor info great website. Thank you Jason! http://WWW.Zipinsight.COM Re posting Jason Woods JASON WOODS on OCTOBER 2, 2018 10:25 PM For lien you don’t need to spend $250 for a title search, you can order one of the lien report from online providers, http://www.zipinsight.com, the data is from title company and can tell you the lien on the property.
    Jason Woods Rental Property Investor from Bellevue, Washington
    Replied 10 months ago
    Thank you Kathryn for sharing. Lien information on the property could be difficult to get, www.zipinsight.com has the most complete records in the industry, I've used it for property research and got good results as well.
    Josue Damas
    Replied 8 months ago
    totally agree, the search for lien info is much more difficult than just typing it up on google lol. Thanks for sharing the zipinsight.com website. Question, how much did you pay to view the lien info?
    Scott Lee
    Replied almost 2 years ago
    Good afternoon.here looking to lean tricks of the trade. I was a logger through the 90′ into 05 had bought & sold 903 ac of land along with 4 homes, 9 repo mobile homes.owned all of it . sold out 04/05. Have 2 two unit buildings now.owned. always pay cash so they say zero credit score. I have a $135k .8 unit pocket deal, fully rented and made a 10k offer on a single fam. In northern MAINE. ( clean and rent now) and a 2 & 3 unit for $23-$29k can’t find a lender with a zero credit score. I could see it if i didn’t have collateral. if you have any. Real Deal info you would share.
    A Schwartz Investor from Raleigh NC USA
    Replied 9 months ago
    yes! you can take any 100% owned property to a bank or other lender and either get a mortgage or a refinance or a HELOC. Any of these routes lead to a money in your bank account, with the property as collateral
    Becky Zienkowicz from Madisonville, KY
    Replied almost 2 years ago
    great info particularly the title insurance, thanks!
    Adriana Silva Specialist from Texas
    Replied about 1 year ago
    Great article, Joshua Dorkin. Although it is an old one but i recently came across this content and had enjoyed reading it.
    Laura Griffith
    Replied 9 months ago
    None of the public links worked for me. They need to be updated. I guess the article was actually written 3 years ago although It just came to my email. I have been going in person to court as I didn't know it could be done online. I was excited for a moment. Oh, well. :(
    Lee Burns New to Real Estate from New York, NY
    Replied 9 months ago
    Wait, is Josh still writing and participating in REI? Josh, welcome back!
    Bobbie Ezra New to Real Estate from NJ
    Replied 5 months ago
    Can you explain what "Clouds on title" means?
    Andrew Wood
    Replied about 2 months ago
    I am in the process of buying a property but I was warned about Liens and taxes. So I did my due diligence and found that the house has a lien from two contractors and back taxes. The problem is that I’m not sure how to proceed from here. Especially because the two contractors do not have any information in the county website. I don’t know how to get ahold of them nor is there an amount that is owed. HELP! I really want this house. Thanks
    Pete Winslow Rental Property Investor from Scottsdale, AZ
    Replied about 2 months ago
    Hey Andrew, I would check in with a real estate lawyer. I believe that the contractors have a certain amount of time to file the lien and then act upon foreclosing on the house. Typically they have 90 days to file the lien and the foreclosing occurs within 12 months of the lien being filed. If these are old liens that have not been claimed then you may be in the clear! Again, I am not an expert and the laws vary state to state but check in to see how long ago it was filed and see if you can get any more information. Hope this helps and good luck with the process!
    Kate Oceanside
    Replied 3 days ago
    My ex husband got sued from Citi bank credit card over $3k debt and he did not response a summon. He received a judgment lien and he is looking up a hearing scheduled but card litigation attorney recorded a lien on my property. We divorced and he removed his name off title but mortgage is together. Can they force to sell my property? What is best to remove a lien on my property?