Aboutliznarr Expertise I can answer questions relating to the purchase and/or sale of residential homes and land, including what a really good agent should be expected to do and/or not do; where to turn when problems occur; and questions regarding disclosure. I`m a Licensed Realtor in the Southeast since 1984 with designations of Broker, GRI, CRS, and CBR (Certified Buyer Representative). Current active and Life Member of Million Dollar Club, Certified by State Real Estate Commission to teach Pre-Licensing and Continuing Education courses, specializing in Agency. Currently serving on Grievance and Professional Standards Committees, and Education Committee in past.
Question QUESTION: Hello... can you please advise in the state of Georgia is it possible for someone to place a lien on your property even if you do not nor have ever had a mortgage on the property? If you sell the property how is the lien extinguished? How does someone just place a lien on your property without proof of justification?
Thank you in advance for your time!
ANSWER: Hi Gina,
I don’t know Georgia law, but in SC where I live and work, an individual lien cannot just arbitrarily be placed of record against a property. There has to have been some type of notification (as for taxes due and unpaid) or legal action brought against a person in which a Judgment was rendered.
I would assume the same would be true for Georgia, however, as any homeowner/defendant has the right to “have his day in court” and face his accuser/plaintiff.
Some of the ways that liens can be placed against a property are:
1. Unpaid taxes (City, County, State and/or Federal, including IRS). If a person receives any notices regarding unpaid taxes and ignores notices and/or demands, the government can “short cut” the process, so to speak.
2. Unpaid assessments (as in condominiums).
3. Judgments (for which there was legal action instituted and concluded).
Whether or not you have, or never had, a mortgage on your property has no bearing on liens being placed against a property. The fact that there is no mortgage on a property just makes it even more appealing for a creditor, as the creditor is pretty much guaranteed to receive his money since there is no mortgage to pay off ahead of his lien (assuming that any lien would be less than the fair market value of the property when sold).
Any unpaid liens due and owing at the time of a sale would convey with a property unless paid off at closing. Since attorneys and title companies search public records prior to closing for the purpose of discovering unpaid liens, most people would not accept a lien with a sale (unless it were a negligible amount). Therefore, liens need to be paid off at the time of, or prior to, closing; and the amount is usually deducted from the proceeds due a Seller at closing if not paid off prior to closing.
If there has been a lien placed against your property that you never received any notice of, you should contact an attorney immediately for legal advice.
Good luck to you, and feel free to write again if you have additional questions.
Regards,
Elizabeth
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QUESTION: Can I please take a little more of your time and ask does a lien ever "expire?" In addition, if I am understanding you correctly, the title to a property with no mortgage is ultimately held by the county in which the property is located. So when a prospective buyer holds a title search for a property with no mortgage attached, the paper "title" is held by the courthouse not the property owner? Is this correct?
Answer Gina,
To my knowledge, liens do not expire. Judgments and administrative liens, in most jurisdictions, have time limits, but never a lien such as a mortgage …unless a mortgage is forgiven and/or satisfied in some manner.
Once a mortgage has been satisfied (paying off any unpaid balance), another document called a SATISFACTION must then be filed at the County to show that the mortgage has been paid off or otherwise removed.
Title to property UNSECURED BY ANY MORTGAGE is held by the OWNER of the property, NOT the county.
Even if you had a mortgage on your property (assuming you live in a LIEN THEORY state), you would still hold the deed to property during the mortgage term…and the mortgage on the property would then be a lien against the property.
Some states operate under the TITLE THEORY where, in the case of a property with a mortgage on it, the borrower does not actually keep title to the property during a loan term. When the borrower signs a mortgage for a loan, the borrower gives the title back to the mortgage holder. The lender then holds title to the property, as security only, until all loan payments have been made. During that time the borrower has the right to possession of the property, and the lender delivers the deed back to the borrower only after the loan obligation has been satisfied.
Title to real property, in the form of a “paper” deed, is RECORDED at the County. This is what is referred to as “of record” – a recording system by which evidence of title or interest in property is collected and kept in a safe, public place. The original paper document is usually returned to the owner after recording.
An owner does not need his original paper deed to sell property if it has been recorded. It is of record at the County – as are any liens and/or Judgments of record.
