Short Answer
A lien is a legal claim against your property by a creditor. Most liens must be paid off when you sell the home. The payoff amount is deducted from your sale proceeds at closing. Common liens include mortgage liens, tax liens, judgment liens, and mechanic's liens. You can sell a home with a lien, but the lien must be satisfied or released before the buyer receives clear title. In some cases, you can negotiate with the lien holder to accept less than the full amount.
Liens are common in real estate transactions and are usually resolved at closing. The title company will identify all liens during the title search, and the payoff amounts will be included in the closing statement. The most common lien is your mortgage, which is paid off as part of the standard closing process. Tax liens for unpaid property taxes must also be paid at closing. Judgment liens from lawsuits and mechanic's liens from unpaid contractors are also common. If the sale proceeds are not enough to cover all liens, you have a short sale situation where the lien holders may agree to accept less than the full amount. Some liens, like certain IRS tax liens, may be more difficult to negotiate. If you have a lien on your property, talk to your agent and a real estate attorney early in the process to understand how it will be handled at closing. The key is knowing what liens exist before you list so there are no surprises.
Bob's Advice
Redfin Senior Agent · AI Certified Agent
A lien does not mean you cannot sell your home. It just means we need to address it. I have helped sellers with tax liens, judgment liens, and contractor liens all close successfully. The key is being upfront about the situation and working with a good title company and attorney. If you know you have a lien on your property, let us talk about it before we list. I will help you understand what needs to happen at closing and whether we need to negotiate with the lien holder.
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