How to Remove a Lien From a Property

As a homeowner, it can be frustrating to find out that a lien—like a judgment lien or mechanic’s lien—has been filed against your property. But you don't need to panic. A lien shouldn’t affect you much unless you’re planning on selling the house or refinancing an existing mortgage sometime soon. In the short term, it’s unlikely that the lienholder will enforce the lien by forcing a sale of your home to get paid. So you’ve got some time to get the lien removed.

In this article, you’ll learn about property liens and some common ways to remove them from your home.

What Is a Property Lien?

If you have outstanding debts, a creditor might put a lien on your home. Some liens, like mortgage liens, are voluntary, meaning you agree to the lien when you take out the loan. Other liens—like judgment liens, tax liens, and mechanic’s liens—are called “involuntary liens” because the creditor doesn’t need your consent before placing the lien. With a judgment lien, for instance, a creditor wins a lawsuit against you and then usually records the judgment against your property. With other kinds of liens, like mechanic’s liens and tax liens, the lienor doesn’t have to get a court judgment before filing a lien.

What Happens When a Lien Is Placed on Your Home

When someone puts a lien on your property, your home effectively becomes collateral for the debt. If you don’t pay the balance associated with the lien, the lienholder could force the sale of your home through a foreclosure to get paid. However, while lienholders generally have the right to foreclose, they usually don’t. (Mortgage lienholders and tax lienholders are an exception to this general rule.) Instead, the lienor will probably just be patient and wait, while interest accrues on the debt.

Then Why Should You Care About a Lien?

If you want to sell or refinance your property, you typically must have what’s called “clear” title. A lien on your house makes your title unclear. To clear up the property’s title, you must remove the outstanding liens.

How to Remove a Lien From Your Property

Here are a few ways to remove a lien from your home.

Pay the Debt in Full and Get a Lien Release

If the debt is valid, the easiest way to remove a lien is simply to pay the creditor in full. After you pay the debt, ask the creditor to execute a lien release form and file it at the county recorder's office, making it part of the public record. The release removes the lien from your home.

Negotiate a Partial Payoff and Get a Lien Release

If a creditor places a lien on your property, you may make an offer to settle the amount you owe for a lesser amount. As part of the negotiations, get the lienor to agree to release the lien. If you need help in the negotiations, consider hiring a lawyer.

Ask a Court to Remove the Lien

If you believe a lien was obtained through fraud, bad faith, coercion, or other wrongful means, you may file a lawsuit against the lienor. If you win the case, the court can order that the lien be stricken from the property records.

You can also ask a court to remove a lien if the debt is valid, but the lienor didn’t follow proper legal procedures when filing the lien. With some kinds of liens, like mechanic’s liens, the lienor must file the lien by a specific deadline. If the contractor waits too long to file, you can petition a court to have the lien removed from the property records. The same is generally true if the contractor neglects to serve you with a copy of the lien. A court will strictly enforce the deadline and service requirements.

Like any lawsuit, a suit to remove a property lien can be costly, and the outcome is unpredictable. If you decide to file a lawsuit against a lienor, you’ll most likely need to hire a Real Estate lawyer to help you.

File for Bankruptcy

If you file for bankruptcy, you might be able to get rid of certain liens through “lien avoidance” or “lien stripping.”

How to Avoid a Lien on Your Property

If you have a judgment lien on your property and you file for, say, Chapter 7 bankruptcy, you might be able to remove the lien by filing a motion to “avoid” the lien. You can avoid (remove) a judgment lien from your home if all of the following are true:

• The lien is the result of a money judgment that a court-issued.
• You’re entitled to claim an exemption in at least some of your equity in the property.
• The lien would result in a loss of some or all of this exempt equity if the property was sold.

Only judicial liens can be avoided, with one exception. (You can also avoid a nonpossessory, nonpurchase-money security interest in certain items.)

What Is Lien Stripping?

In a Chapter 13 bankruptcy, you might be able to remove certain junior liens, like a second or third mortgage, from your real estate in a process called “lien stripping.” You can strip a junior mortgage lien if the home is worth less than the balance of the senior mortgage.

It probably doesn’t make sense, though, to file bankruptcy just to eliminate a property lien. But if you’re considering bankruptcy to deal with multiple debts, consider talking to a bankruptcy lawyer to learn more.

Wait Out the Statute of Limitations

If a specific amount of time passes, the lien will expire. The statute of limitations for a lien varies depending on the type of lien and state law. But be aware that state law often gives lienors the option to renew their lien.

See a Real Estate Attorney

If you learn that a lien has been placed on your property, consider talking to a real estate or foreclosure lawyer to learn about your rights and options, including ways to potentially settle the debt or fight the lien if it's invalid.