Believable real estate sales listings create a firm foundation for profit. But for your property to stand out, you need to understand lien processes better than most.
From recording deeds to collateralization, lien services are essential to the real estate industry. Keep reading to learn more about the role lien services play in the world of finance!
What Is a Lien?
A lien is a legal claim against a physical or financial asset that is used to secure payment of an outstanding debt or obligation. The borrower, usually referred to as a debtor, must pay off their debt for the lien to be released.
It can also be used to protect a creditor’s interest in goods or services provided. Typically, it’s used for secured loans such as mortgages and auto or boat loans or when a person or business needs materials or services from another party.
Types of Liens
A lien is used as a form of security to guarantee repayment of a debt or performance of a contract. There are several common types of liens that may be used in different circumstances.
Tax Liens
Tax liens are a type of lien service that involves the government placing a claim against an individual or business for unpaid taxes. When a taxpayer fails to pay taxes owed to the government, the taxing authority will issue a tax lien.
Mechanic’s Liens
It’s designed to protect the contractor’s right to get paid for the goods and services provided to the property owner. In order for a lien to exist, the contractor must issue a preliminary notice, which serves as a notification of the lien rights the contractor has over the property.
To know more, click here for more about preliminary lien notices.
Business Liens
Business liens are an important form of lien services used in the business world. These are generally used to collect a debt due to the failure of a company or individual to pay their debt.
Lis Pendens Liens
A Lis Pendens lien is a type of lien service that’s used to alert potential buyers that the property has an existing claim on it. This lien service is commonly used when there is a dispute between two parties, often involving a breach of contract or fraud.Â
Judicial Liens
A judicial lien is a lien placed on the property as a result of a court order. This type of lien may be sought in the event of a court-ordered settlement or other involuntary payment.
Depending on the type of lien imposed, the creditor may be able to recover the debt or contractually owed funds by seizing the related property.
Learn More About Lien Services Today
Understanding liens is crucial to protect financial interests. If you require more information, visit your local government website for a detailed explanation of your state laws.
Having a proper understanding of lien services will help ensure you protect your legal rights and interests. Contact a lawyer for specific advice on your particular situation.
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