Sunday, February 17th, 2019 February17th2019

Sell for More Trivia: What is a lien?

Published on February 17th, 2019

Sell for More Trivia is a weekly blog series that playfully presents a trivia question about commercial real estate.


A lien is a claim that someone has on a property that you possess or use.

The individual or entity that has the claim, such as a lender, can repossess or foreclose on the property if you don’t make payments on an associated loan or perform other agreed-upon terms.

Liens are not typically discharged until they’re paid off.

Types of Liens

Consensual liens are those you consent to when you purchase a property through financing. You want the loan and it comes hand-in-hand with a consensual lien until you pay it off.

Statutory or non-consensual liens are obtained through a court process to put a claim on an asset for unpaid bills. These can include tax liens—a lien is placed against the property of someone by a federal, state, or local government for non-payment of taxes—or contractor’s or mechanic’s liens.

A contractor might do work for a property owner but doesn’t get paid. The contractor, therefore, goes to court to get a judgment against the property owner for the money. The judgment can then be used to place a lien.

Should the property owner attempt to sell the property, the contractor’s lien would have to be paid off along with any mortgage against the property and any other liens or security interests on it.

Contractor liens can also be filed against a property owner by sub-contractors who haven’t been paid by a contractor. A general contractor doing major renovations on a property might hire a plumber to take care of that specific part of the job. If the contractor doesn’t pay the plumber, the plumber can file a lien against the property.

When Property Is Sold

Liens against assets must be paid off when the individual using the asset sells it. She can’t receive payment for the sale until this happens.

How to Prevent a Lien

A “release of lien” is a written statement that removes property from the threat of the lien, usually in the case of a mechanic’s lien. It’s basically a signed document signed by the contractor that prevents having a lien put against the property.

It should be signed at payment as proof of payment and as an assurance that the property will not have a judgment placed against it.


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About Beau Beach, CCIM

Beau is a tenacious Commercial Real Estate Broker, author and adoring father of four. His clients appreciate his no-nonsense demeanor and his legendary work ethic.

Beau leads Prowess IRES which is a commercial real estate broker for sellers in the Nashville, Milwaukee, South Florida and Chicago markets.

He’s the author of the books The 3 Reasons: Why Most Commercial Properties Don’t Sell and True Wealth: What Every Seller Should Know About 1031 Exchanges.

Beau can be reached at 414.324.4938, 615.603.9770, click to schedule a call or