You have finally found the perfect home that you have always dreamed about, and you can’t wait to get the keys and move in! But, small problems might pop up along the way, so it is important that you are working closely with an experienced Atlanta real estate agent who can help you with every step of the home purchase.
One potential issue is that there might be a lien on the home. This problem could be a frustrating one to deal with, because it could potentially stop the closing.
What is a Lien?
A lien can be placed on a property if a debt needs to be paid. The financial institution or individual that loaned the money can lien the house against the owner for the value that is owed. This process uses the real estate as collateral to ensure the debt is paid, and the home can be an asset that is used to pay the debt if the payments are not met in full.
The lien might be related to the home, or it could be the result of a different situation. Here are a few examples of situations that might result in a lien on a property:
- Mortgage, which holds a lien on the property until the home is paid off
- Unpaid property taxes
- Unpaid contractor work, such as remodeling or home upgrades
- Judgements of unpaid debts awarded in court
- Unpaid child support
- HOA fees that are overdue
- Unsettled divorce judgments
There are several different types of liens on real estate properties, and it is important that you check for liens because they will impact the closing of the sale. A mortgage lien is a standard lien because many homes have a mortgage, but other types of liens might be unexpected.
How to Handle a Lien on the Property
If there is a lien on the home that you would like to buy, then the seller will have two options. If they have an owner’s title insurance policy, then they will need to apply the lien to that policy. This option is only available if the lien was not the result of their own doing. The second option is to pay the lien in full before closing.
Searching of a Property Lien
The hope is that the lien can be discovered early, so that the seller can take care of the problem right away. The attorney will run a title search to see if there are any property liens that might prevent the closing of the home. It is always smart to talk with your real estate attorney to double check that the property search was completed.
Here at Duffy Realty of Atlanta, we want to help you buy the home of your dreams with as little hassle as possible. Contact us for more information about how you can buy a home in Atlanta: (678) 318-1700