Can You Sell a House With a Lien on It?

Types of liens on homes 

Not all liens are created equal. In fact, there are several types of liens you may have on your home, including:

• Tax liens: If you don’t pay your property taxes, you might face a tax lien on your home.

• Mechanic liens: A mechanic lien may come into play if you haven’t paid a contractor for work they performed on your property.

• Judgment liens: Judgment liens arise from court judgments against you because you failed to repay a debt.

• Mortgage liens: If your mortgage goes into default, you may receive a mortgage lien that can give the lender the right to foreclose on your home.

• Homeowner association (HOA) liens: HOA liens might occur if you don’t pay your HOA fees.

“Each type of lien has its own process for resolution, but they all need to be addressed if you want to sell your property,” explains Roberts.

Can you sell a home with a lien on it? 

While you can sell a home with a lien on it, the process can become complex. 

“You need to resolve the lien before selling as buyers don't want to inherit debt, and lenders won't approve a mortgage with an outstanding lien,” says Roberts.

As a seller, it’s your responsibility to either pay the lien off at closing or work out a deal with the lienholder to release the lien.

How to find liens on a property 

To locate liens on your property, check with your local county recorder's office, assessor’s office, or clerk’s office where the property is located.

“Many of these have online databases. Some states also have statewide lien registries,” explains Roberts.

You can also take advantage of portals like Property Shark and Property Checker, which can allow you to search for liens by property address or owner's name. If your situation is complex, it might make more sense to hire a title search company or get in touch with a real estate attorney. 

“They can dig deeper and provide a comprehensive report on any liens or other issues with the property,” says Roberts.

What to do if there is a lien on a property? 

If you determine there is a lien on your property, the first step is to figure out what the lien is and how much you owe. Then, contact the lienholder to negotiate a resolution. You may need to work with a real estate attorney or a title company to facilitate the process and ensure everything is handled properly.

In some cases, an attorney can help negotiate a lesser release amount or even help you strip off a judgment lien in bankruptcy.

“It is important to understand your options. If you owe more than your property is worth on your mortgage, then you may need to negotiate a short sale. Some realtors specialize in short sale negotiations,” says Ashley Morgan, attorney and owner at Ashley F Morgan Law, PC.

“Regardless of the specifics of your situation, be upfront with potential buyers about any liens, as this can impact the sale price or how attractive the property is to them,” explains Roberts. By doing so, you can increase your chances of a successful sale.