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How to Deal with an Improper Lien on a Property

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When dealing with real estate, one of the stickiest issues to address is when there's an improper lien placed on a property. There are some concerns you'll need to address, and here are three of the big ones a real estate attorney will tell you to look into.

Who Placed the Lien

The first order of business is determining who the heck placed the lien to start with. A lien can arise from many things, such as outstanding debts, tax bills, legal judgments, and claims on collateral. Try as they might, courts don't always get it right when they allow lien holders to take action.

Using the information from the county, you can then contact the lien holder and determine why they imposed one. If the lien seems legitimate, you can ask for instructions on how to resolve it. That usually involves settling the debt attached to the lien.

If the Lien Was Wrongly Applied

You'll need to figure out why the lien was invoked. This can happen for a lot of reasons. On the innocent side of the ledger, someone might have failed to record payment of the debt. For example, a municipality might have lost track of a payment you made on an old tax bill. You should be able to present the lienholder with proof of payment and have them release it. If they dig in, real estate attorney services are available to petition the court to have the lien stripped.

There are also fewer innocent explanations. A form of identity theft, title fraud is a rather nasty reason for an illegitimate lien. Someone else may have represented themselves as you or fraudulently gained access to the title. They might have used the property to get a loan with no intention of ever paying. Once the loan went into default, a lien was placed on the property. That case will require some unraveling to show you never transferred the property and that the loan was fraudulently acquired.

Ways to Terminate Liens

Ideally, the lien holder will be reasonable about what happened. You can send them a release-of-lien form. Once they've returned it to you signed, you can then submit it to the court to have the lien ended. Some states have statutory limits on liens. A real estate attorney can help you figure out if the limit has passed. Be aware this does not get rid of the debt if it is valid.

Finally, you can seek a court order. Your real estate attorney will present the evidence that the lien is illegitimate and ask a judge to invalidate it. Learn more by contacting legal services like Souders Law Group.