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Lien is defined as the legal claim against a property. Once the property is sold, the lienholder is then paid the amount that is owed.
Lien Explained
A legal claim against property that must be satisfied when the property is sold. A claim of money against a property, wherein the value of the property is used as security in repayment of a debt.
Examples include a mechanic’s lien, which might be for the unpaid cost of building supplies, or a tax lien for unpaid property taxes. A lien is a defect on the title and needs to be settled before the transfer of ownership. A lien release is a written report of the settlement of a lien and is recorded in the public record as evidence of payment.
