If you’ve ever sold a home, you know how lengthy and stressful the process can be even when both parties bring no obstacles to the table. Selling a home with issues attached can take the entire transaction to a whole new level if you don’t know what to do.
It is very important to have information about how to sell a home with a lien to help smooth the process. If you're trying to sell your home but it has a lien on it, here is what you should do.
What is a Lien?
A lien is a claim on real property related to an unpaid bill by the homeowner. It is essentially a way to ensure the creditor gets the money owed. Once a lien is placed on a title to real property, it is more difficult to sell; however, it may be possible to do so.
Selling Your Home with a Lien
If you need to sell a home fast but there is a lien, there is information you need to know to help make the process easier and do-able. Here are some of the considerations you need to know:
Selling AS-IS
If there is a lien on a property, the seller must sell the home AS-IS. This means that the lien is there and must be satisfied. People who buy houses for cash often work with sellers on this type of transaction.
Determining the Type of Lien
The type of lien on the property is important. Some liens are not negotiable such as property tax, child support, IRS and others. Before attempting to negotiate a settlement, determine what type of lien is on the property. Liens are public record, so it is easy to find out the existence of liens and what type exist.
Finding a Buyer
Because selling a home with a lien can be tricky, finding a buyer skilled at buying real property with liens attached is key. Investors and buyers who know how to buy houses with liens, and for cash, can be of great help to sellers.
Negotiating Payments to Creditors
Judgments tied to liens are typically negotiable. It is helpful to work with investors well versed in buying properties with liens and negotiating payments with creditors. These investors typically buy houses in any condition including those with liens.
Settling the Liens
When working with creditors to settle the lien(s), sellers may not have to pay the agreed settlements before closing. Depending on the type of lien, creditors may agree to accept payment at closing when the payments are deducted from the proceeds. They may also agree to a full or partial release of the lien when settling it. Again, working with experts to sell property with liens is especially helpful.
Working with Experts
The considerations mentioned are much easier to perform when working with experts at negotiating and settling liens. Investors or title experts are skilled at navigating the process, knowing what to say to whom and completing the transaction.
Other Important Factors
While attempting to complete the transaction without expert help can be done, it is tricky and often complicated. Creditors know that, along with the stress of settling the payments, sellers have emotions tied into the process. Companies and investors with experience at buying homes with liens can make the process less stressful.
Like always, each state has different rules and regulations when it comes to selling a home with a lien. We recommend you work with professionals who know the laws in your state.