Selling a House with a Lien in San Diego

YES! When it comes to selling a house with a lien, there are several key points to keep in mind, including:

• If there is a lien on your property, selling it will be more complicated than using traditional methods, but it’s possible and we buy houses with liens.
• While the simplest approach is resolving the lien prior to sale, this requires considerable financial resources.
• If your property is especially well located, a real estate developer or another buyer may be interested in taking on the lien with purchase, but this is the exception rather than the rule. 
• The best option if you’re ready to sell is working with a real estate investor who will guide you smoothly through the steps necessary to determine if your home with a lien attached qualifies for sale and, if it does, will expedite the process.

Putting a lien on a house is a common occurrence, but it doesn’t have to be the end of your selling journey. Basically, if the property owner fails to clear an existing debt, the creditor can seek repayment of this debt by filing a lien. When it is filed, the creditor gets the lien recorded in the local county recorder’s office, thereby making it a public record.

In that context, the one who files the lien is known as the lien holder, and they get a legal right to a piece of the property once the lien is approved. Most liens are approved by the California court, but in some scenarios, the homeowner may voluntarily grant the lien.

For example, if you have failed to clear the mortgage payments on your property, the lender may file a lien against the property. When the court approves the lien, the mortgage lender will have the right to a portion of your California property. If you still fail to clear the debt after that, the lender will be able to seize the property and sell it to recoup some of their losses.

On that note, the borrower or property owner will not have a clear title if a lien is placed on the property they own. In other words, the owner will lose the ability to sell the property independently, which means that they will need consent from the lien holder before doing so. Besides, it can make it difficult to subdivide the house. It can also prevent the owner from getting a mortgage until the lien is resolved.

So, when and how can you sell property with a lien on it? As we said, in certain situations, you can sell your house even if there’s a lien on it, but guidance is advised. There is a specific process involved with selling a home with a lien attached, and some of the best companies out there can help. We think we are one of these companies, so please reach out with any questions and we’ll do our best to help you out, but let’s take a look at your options.

Occasionally, real estate developers are willing to pay for homes with liens on them in an effort to speed up the process. This is typically a matter of satisfying a specific need, such as where the property is located.

If you’re able to pay off the lien placed on your property before you list it, it’s the simplest approach, but it’s not always financially feasible. If you do go this route, it’s important to obtain a copy of your release of lien letter from the lien holder as soon as your payment clears. This allows you to show any potential buyers that there is no legal claim against your title.

If you have enough home equity, you can use the proceeds from the sale of your home to release the lien. When it comes to how to remove a lien on property, this is a good option for anyone who’s accumulated some equity in their home over the years but doesn’t have the resources to pay off the debt associated with the lien.  

If taking care of the lien prior to or during the sale of your home isn’t a possibility, you can contact the lienholder directly, and they may be interested in negotiating a settlement – or payment – plan. This can lead to the holder granting release of the lien based on the payment plan, which puts you in a better position to sell.

If you believe the lien against your home is not legally valid, you can address the matter with the court in an attempt to have it dismissed. The lienholder involved will be tasked with proving the lien’s legitimacy, which is called perfecting the lien.

If you’re successful, such as if the 10-year statute of limitations that applies to liens has run its course, the lien on your house will be resolved. You can begin the dispute process by contacting either the title company or a real estate attorney.

If you’re asking yourself “what is the best way I can sell my house for cash in California quickly”, SoCal Home Buyers is on your side. If you’re ready to sell but aren’t sure how to begin, we offer a streamlined process that will analyze your unique situation – determining if you’re in a position to sell and, if so, determining your best steps forward.

We specialize in complicated home purchases like yours, and while traditional sales follow strict timelines, we can offer far more flexibility, allowing us to wait-out time-consuming complications that often stall sales involving property liens. We can even delay the transaction until you’re able to sell. 

We’re well prepared to assess the circumstances surrounding your home lien, and if we’re able to buy your property, we will streamline the sale process, assess the value of your home, and make you a fair cash offer.

If you’re prepared to sell and want to learn more about selling a house as is in California, SoCal Home Buyers invites you to reach out for more information about what we can do to simplify the process for you. Working with the right buyer can make all the difference when it comes to a matter as complex as selling a house that has a lien on it.

Now that you have a basic idea of what liens are and how they work let’s discuss the different types of liens in California. Below, we have mentioned some of the most common liens used by creditors today.

• Judgment Lien

  Also known as a judicial lien, this is a type of lien that is placed on the property after a lawsuit. When the property owner fails to pay the creditor, the latter may sue the former in a court of law. If the court judgment goes against the owner, they will be instructed to clear the debts of the winner within a given time.

  However, if the owner still fails to settle the financial obligations, the creditor can file a judgment lien against the California property. By doing that, they can liquidate the property asset and recoup some of the losses.

• Mortgage Lien

  The mortgage lien is possibly the most common type of lien placed on properties. As you can guess from the name, mortgage liens are used by mortgage lenders whenever they issue a loan against a property.

  In that context, it is a voluntary lien granted by the property owner when they finalize the loan and sign all the relevant documents to close on the property. Basically, the lien allows the lender to use the property as collateral. If the California homeowner fails to complete their mortgage loan repayments, the lender can seize and sell the house to recoup the loan.

• Property Tax Lien

  Commonly referred to as a tax lien, it is placed on a California house when the homeowner fails to pay the real estate tax and other property taxes. This lien is also very common, especially in the domain of taxation, and it takes priority over other types of liens placed on a California house.

  Property tax liens are used by relevant tax authorities or the government. It enables them to seize the asset from the owner, especially if they have failed to pay property taxes for a long time. By selling the property, the government recoups the unpaid taxes, along with any existing interests and penalties.

• IRS Tax Lien

  The Internal Revenue Service (IRS) tax lien is very similar to the property tax lien since it is also used by the government. However, IRS liens are issued when the owner fails to pay income taxes on time, which distinguishes it from property tax liens.

  Such a lien is issued by the IRS as a means to encourage the owner to clear any unpaid taxes. If they are unable to do that, the lien enables the IRS to foreclose the property, thereby helping to address any financial obligations.

• Mechanic’s Lien

  When the property owner hires contractors to get work done on their property and fails to pay them on time for their services, this type of lien is used. These contractors include not only mechanics but also material suppliers, designers, architects, engineers, and other similar people.

• Child Support Lien

  The child support lien is placed on a property when the owner fails to pay child support ordered by a court of law. In this regard, it is very similar to a judgment lien since it is issued on the basis of a court judgment.

• HOA Lien

  A Homeowners Association is an organization that conducts periodic assessments and maintenance of community-owned properties. And in order to do these tasks, the HOA collects fees from registered property owners. However, if an owner fails to pay the fees due to the HOA, then this lien is issued.

  HOA liens are issued even if the owner has cleared all his tax debts and other financial obligations, which means that it is used independently of the other involuntary liens. It allows a California HOA to foreclose the property and recoup some of the financial dues. Luckily, the severity of HOA liens is usually less compared to the other types of involuntary liens discussed so far.

• Bank Lien

  If you have taken a bank loan to purchase the property, and have failed to clear the debt owed, then this lien will be placed on your California property by the bank. It is functionally similar to a mortgage lien since it allows the bank to use your property as collateral. If your dues keep piling up, the bank will use this lien to seize your property and sell it.