Liens on real estate are defined as claims against property that are created to secure payments of a debt. If one owes a debt, usually called a debtor, owes money to another person or business, usually called a creditor, then the creditor is able to and may place a lien on the debtor’s property for the worth of the debt that is owed. From the result of the lien, the real estate is used as collateral against the debt. According to real property law, if the debtor does not satisfy the debt by paying it all off, the real estate or collateral becomes an asset that is a great potential source of the payment of the debt that is owed.
Several situations can call for a placement of a lien on real estate. Property owners may place voluntary liens on their very own property such as mortgage lines. Due to the fact that they are pledging their real estate as collateral for mortgage loans, many homeowners are capable of securing the funds that they need for home improvement, debt consolidation, and so many others areas. In nature, liens are involuntary and usually forced in real property law.
If a homeowner decides not to pay for property taxes for whatever their case may be, the government unit that is responsible for assessing property taxes, has the right to place a lien on the property. This is usually called a construction or mechanic’s lien. The judgements for unpaid debts given by the court can attach as liens to a debtor’s property.
There is a process that creditors follow to place liens on property that differs with each state law. In most states, there are detailed notice requirements that a creditor must proceed to follow in order to notify the debtor that the lien may be place on the piece of real estate.
Creditors must be cautious when taking the steps, under the real property law, in order to release a valid, legally binding lien on the debtor’s piece of estate. It may include filling out certain legal documents with a court, recorder’s office or county clerk’s office. It also may include preparing paperwork to be given to the jurisdiction’s land records to be kept on file.
In real property law, there are ways to release property liens. The most evident way to release one is to pay the creditor the debt in full. The creditor must release the lien on the debtor’s real estate if the judgement or debt is paid by the debtor. The passage of time can also release a lien in most jurisdictions.
In a fair amount of states, a judgement may be voided after twenty-five years. The release of judgement lien is released by operation of real property law. Exact procedures differ from state to state, the creditor most likely will and must execute all the appropriate documents that release the lien which is placed on file with the appropriate governmental system. A lien release notifies to everyone that the creditor has been stripped away of any valid legal claim to the debtor’s property.