title. However, a lienholder is granted certain rights regarding the property — namely, a share in the sales proceeds if the loan isn’t paid o ff a nd the property is sold. Lienholders can’t place themselves on to the title to obtain ownership. Th e main right of a lienholder is to have priorities from the proceeds of a sale in the event of a default on payments or a foreclosure. Only in rare circumstances do creditors demand the sale or foreclosure of property to pay o ff a lien. If a property is mortgaged, the creditor-lienholder, on enforcing foreclosure, must continue mortgage repayment. Creditors prefer to wait until the property is sold. IF A LIEN IS FILED ON YOUR PROPERTY In the event a seller fir st discovers a lien fi led on owned property when preparing to sell the home, the fir st step is to determine if the lien genuinely belongs to him. Lien holds are searched by owner name. Sometimes multiple matches will return from a search. Relatives who share similar names or those with unusually common names (e.g., Smith or Jones) migh t fin d themselves asked about liens they didn’t incur. In this case, your real estate agent and title company will determine what proof is needed to clear the issue. Typically, all that’s needed is a ver ifi cation of your birthdate or home address. If, however, you’re the seller and the lien is appropriately on your property, work to resolve the issue as soon as possible. Contact the lienholder and arrange how to pay it o ff . O ft en, the repayment will come out of the proceeds of the sale of the house. For particularly complicated liens, you might seek legal counsel. Th ere are various actions you can take if a lien is placed on your 108
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