21 Aug Can I Sell My Home with a Lien?
Yes! You can absolutely sell your home even if it has a lien against it. In fact, selling your home can be a wise option to resolve the lien if it is significant.
You are unlikely to get a typical buyer to purchase the property and assume the lien; in this situation, it is more likely you will need to sell to a real estate investor.
Here is what you need to know about selling a property with a lien.
What is a Lien?
When you owe a debt, the creditor may be entitled to put a lien against your property. That means that they are entitled to recover their debt from you when you sell the property. Liens are recorded against your property title, and usually must be resolved to close. You may find a lien against your property if you owe:
- State or federal taxes
- Property Taxes
- Municipal Fines
- Child support
- Homeowners’ Association fees
- Contractor payments/construction fees
- Civil judgments
You may also find you have a lien against your property if you are significantly behind on your mortgage payments. Your mortgage lender can place a lien against your home.
How Do I Know If I Have a Lien?
Although you should have been notified if a lien has been placed against your home. all liens are revealed in a title search. You can order a title search from a real estate attorney who can either reassure you that you do not have a lien or help you determine who and what you owe to resolve the lien. It is also important to discover if your property has a lien before you list your property for sale and begin the closing process – discovering a lien later in the process can significantly delay closing.
You have several options open to you if a title search reveals there is a lien against your home, including:
- Pay the debt outright
- Negotiate the debt down
- Dispute it if you believe it is an error
- Sell the home and pay off the lien with the proceeds
How to Sell a Home with a Lien
When you realize you have a lien against your home, it is wise to seek professional advice right away. Not only is it possible for you to sell a home with a lien, but under certain circumstances, you may be forced to sell your home, or the creditor may take possession of it to resolve the lien. Financial and real estate advice will both help you get on the path to resolving a lien.
The Homestead Exemption
Here in Illinois, your primary residence may not be forcibly sold to satisfy the lien if you have less equity in the home than the exemption amount. Currently, that amount is set at $15,000 for a single person.
Remember, seeking out advice from a real estate lawyer who understands your specific circumstances is always the best thing to do.
Contact Mages & Price LLC Today
Mages & Price LLC works with home sellers across the Chicagoland area, streamlining the sales process and protecting your investment, time, and home. We understand how stressful selling a home can be and aim to minimize anxiety and maximize profit.