The Purpose of a Creditor’s Property Lien

by Isaac Benmergui, Esq on February 19, 2014

There’s no way around it: real estate law hates debt. Loathes it. So it would do a renter or homeowner well to try and avoid it. Whenever there’s debt compiling due to some property mortgage or rent payment, there are a variety of collection methods available, most depending on the policy of the company collecting. Traditional methods include all the standard calls and letters we get, the ones we want to avoid, but this one is the most hard-hitting action that can take place – and it’s often the one we as homeowners and renters can’t avoid – the “property lien.”homes

Don’t be afraid, though – because as I say, it can be avoided just by making your payments every single time. By real estate law, if a debtor fails to catch up on debt or even respond to creditors in any way, quite frankly, a lien may be the only recourse. It is often referred to as a “judgment lien,” one ordered by the court, rendering it completely legal and with enforcement backing it up.

However, there is a timeframe by which a lien must be processed, and it all depends on when the creditor files a lawsuit against the debtor in question. Wait too long, and the lawsuit for the lien won’t fly in court, unless the debtor doesn’t contest it in court. By law, that lien when made effective by the court will remain active until the entire debt is paid off. The lien, too, has basically a timeframe, meaning it can expire. However, for the most part, creditors can renew it if there’s still a remaining balance for the debtor to cover.

It may be nothing more than a piece of paper, though, but there’s power behind it. It allows the creditor the power to force a debtor into court and present any relevant and available assets for possible determination of judgment. However the debtor can pay, will be the way it’s paid. It’s a legal action. Whatever you do, you definitely don’t want to let a lien sit there – or else you’re giving a creditor the jurisdiction to request a “writ of execution,” effectively foreclosing on the property and leaving you high and dry!

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