Real estate liens can be a complex hurdle for buyers and sellers alike. Whether you’re planning to purchase your dream home or sell your property, understanding liens is essential to ensure a smooth transaction. In this blog post, we’ll break down what real estate liens are, how they affect property transactions, and how an experienced Real Estate Broker can guide you through the process.
What Is a Real Estate Lien?
A real estate lien is a legal claim placed against a property due to unpaid debts or financial obligations. Common reasons for liens include:
- Unpaid property taxes
- Unpaid mortgages or home loans
- Outstanding contractor or mechanic’s fees
- Delinquent homeowners’ association (HOA) dues
A lien allows the lienholder to claim a portion of the property’s value to satisfy the debt. This can have serious consequences for both buyers and sellers.
How Liens Affect Buyers and Sellers
For Buyers
Purchasing a property with an unresolved lien is risky. If the lienholder’s debt isn’t resolved, they could foreclose on the property—even after the buyer takes ownership. To avoid this, buyers must research any liens on a property before making an offer and ensure the lien is addressed before closing. Most the time, liens will show up on a title report and can be dealt with accordingly from there. It is very important to review and understand all the items within the title report to protect yourself from errors and unknown liens.
For Sellers
Sellers with a property lien may face challenges in selling. A lien must typically be paid off before the property can change hands, which can reduce the seller’s net proceeds. This can make it difficult to sell the property for the desired price or on the preferred timeline.
How Can a Real Estate Broker Help with Real Estate Liens
An experienced Broker will understand the importance of lien searches and reviewing the title report issued prior to closing. Here is how a Real Estate Broker can assist:
1. Research and Disclosure
Research and follow up with title on any liens associated with a property before an offer is made or you list home.
- Understand the type of lien and its priority.
- Evaluate the financial obligations tied to the property.
2. Access to Legal Resources
Your Real Estate Broker can connect you with trusted real estate attorneys and professionals who specialize in lien-related matters to help protect your interests.
4. Creative Solutions
Many times in real estate deals associated with liens, there are programs and alternatives for buyers and sellers in satisfying their goals. Government back grants and seller carry financing are two options that a real estate Broker can assist with.
The Bottom Line on Real Estate Liens
Real estate liens don’t have to derail your plans. By understanding how they work and partnering with the right team, you can overcome these challenges and achieve a successful transaction.
At Coldwell Banker Holman Premier Realty we’re here to help you navigate real estate liens with confidence. Whether you’re buying or selling, our experienced agents provide the expertise and resources you need to succeed.
Contact us today at (541) 884-1343 to learn how we can assist you with your real estate needs in Oregon!