Filing a property lien is typically only used as a last resort for lenders—but it may be your best option if you’ve tried all other ways to collect the money you are rightfully owed. In order to make sure the frustrating, time consuming, expensive process of filing a property lien is as painless as possible, hiring an experienced attorney to help is generally a good idea.
A lien essentially allows you to repossess property that the individual you loaned money to put up for collateral. A lien also prevents the property in question from being sold or given away until after the debt is completely paid off. Once the debt is paid, the lien can be removed and the borrower can receive the title and be deemed the official owner of the property.
Sometimes, you may want to go to civil court before placing a lien on a property. In this case, a judge will demand payment of the debt owed to you and give a deadline for the property owner to respond. If they do not respond, then you may want to take more serious action—such as filing a property lien. In most cases, the judge will then request a disclosure of assets. A disclosure of assets allows you to see what properties the defendant owns, and the judge will then decide which property or properties you can put a lien on. Once the lien is put on a piece of property, the owner will be given a new deadline to respond, and if they do not, the property can be taken away and handed over to you.
If you do not want to place a lien on the property or the defendant does not own any property, the court may order that a certain amount of the debtor’s income be taken directly out of their paychecks and given to you. Once the debt is paid, the automatic withdrawal of money will stop.
However you choose to obtain the money owed to you, make sure you abide by the laws for the county in which the property with a lien is located, or hire an attorney who is an expert on property liens.
Articles on this blog are provided for informational purposes only. Use of this blog does not provide or replace individualized legal advice. If you are in need of legal advice, please speak with one of our attorneys, who can offer legal advice specific to your circumstances.