I would say that your answer depends. The creditor probably cannot unilaterally place a lien on the property. But if the creditor obtained a judgment against your parents, then a lien would be one of the available remedies. More information is needed and you should consult an attorney in order to determine how best to proceed.
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You haven't given enough detail for a coherent answer, but the nature of your situation seems to complicated for any easy answer. This is not one of the questions that can be answered in generalities. You really need to consult with someone with specific facts and circumstances, and I highly encourage it.
This reply is for general information and educational purposes only applies to Michigan law only and should not be relied upon as creating an attorney-client relationship or as legal advice by a lawyer to a client unless and until the questioner and an attorney have entered into a written attorney-client relationship pursuant to the terms of a signed engagement letter specifying, among other matters, the scope of the engagement and the attorney's billing rates and procedures .
A lien is not placed on a deed. A lien is placed on a parcel of property and is recorded in the chain of title. Moreover, a life estate deed is revocable by the grantor (your father).
Whether the lien is legitimate or not the title to your father's property is now clouded by this lien and is therefore unmarketable by definition of the Michigan Marketable Title Act. There are various types of liens, mortgage, construction, homeowner's association, judgment, state and federal tax lien, and special assessments...I may have forgot some but that is about it. There are also various liens that may have no legitimacy whatsoever.
However, what you described sounds like a judgment lien. A judgment lien is a court order money judgment and cannot be foreclosed out...but a judgment lien has priority over other various liens and the judgment lienholder is in line to get paid off when your father decides to sell the property.
You therefore have two options. One, payoff the lien or work out a settlement. Two, file a slander of title action or quiet title action if you think the lien is not legitimate. But, if it is court ordered, it is legitimate.
Nevertheless, you should seek counsel to help you navigate this process. I can be reached at 248-270-2709 if you would like a low cost solution.
*The answer to this question does not constitute legal advice nor does create a client relationship with the attorney answering this question. For more specific advice regarding your situation, please consult an attorney*