Property Title Search: How To Find Liens On A Property

A property lien search is basically checking if a property you're interested in has any outstanding debts or claims against it. Think of it as doing homework before buying a house, making sure no surprise bills or debts come your way after signing the papers. Liens can be anything from unpaid mortgages to overdue taxes, court judgments, or unpaid construction bills.

Imagine you buy your dream house and later discover the previous owner didn't pay property taxes. Suddenly, that debt is your problem. A lien search helps you avoid this exact situation by finding out about these hidden debts before you finalize the purchase.

Why is a Lien Search Important?

Doing a lien search helps ensure your new property is free and clear of financial troubles. It reveals issues that could complicate or even halt your transaction. For instance, unpaid utility bills or city fines that were overlooked could pop up after the deal is closed, causing headaches and extra expenses.

Here are some typical liens a property lien search can uncover:

Mortgage Liens: These occur when the previous owner still owes money on their mortgage.
Tax Liens: Result from unpaid property taxes owed to local governments.
Judgment Liens: Placed against properties when a court judgment requires payment from the property owner.
Mechanic’s Liens: Contractors or builders file these when they're not paid for work done.
Municipal Liens: Include unpaid utility bills, fines, or other city-related debts.

DIY vs. Professional Lien Searches

You can do a lien search yourself by going to your local county offices, tax assessor's office, or checking court records. But let's be honest, it can be complicated, confusing, and takes a lot of time.

For instance, you might have to look through numerous records, double-check different sources, and even then, it's easy to miss something important.

That's why many people prefer hiring professionals. Experts know exactly where to look, what to ask, and how to interpret the findings. They also usually have access to specialized databases, making the search quicker and more reliable.

How to Conduct a Property Lien Search Yourself (Step-by-Step)

Here's a straightforward guide if you're willing to try it yourself:

Visit the County Clerk's Office. Check public records for mortgages, recorded liens, and ownership history.
Check the Tax Office. Find out if there are unpaid property taxes.
Search Court Records. Look for legal judgments against the current owner.
Contact Municipal Offices. Ask about any outstanding city fines or unpaid utility bills.
Check with HOA/COA. Confirm there aren't any unpaid homeowners or condo association fees.

However, because the DIY route is complicated, many buyers prefer professional assistance.

Cost of a Property Lien Search

The cost for a property lien search typically falls between $50 to $150, depending on where the property is located and how complex the search is. To save money, you might consider:

Getting quotes from different providers to find the best deal.
Bundling the lien search with other title services or title insurance for a discount.
Using automated software services that can speed up the process without high costs.

However, cheaper doesn't always mean better, especially if it means missing important information.

Legal Stuff You Should Know About Liens

Knowing a bit about liens' legal side can help you navigate property purchases more safely:

Lien Priority: Some liens, like tax liens, take priority over others. This means they have to be paid off first.
Seller’s Responsibility: Usually, the seller must disclose known liens. However, as the buyer, you need to double-check everything.
Resolving Liens: All liens typically need to be resolved before you officially own the property.
Duration of Liens: Liens have different lifespans; some last until they're paid, while others expire after a certain period.

Tips to Avoid Property Lien Problems

Here’s what you can do to keep yourself protected:

Always perform a thorough property lien search.
Ask for detailed reports like an O&E (Owners and Encumbrances) report.
Buy title insurance to cover anything missed in the initial search.
Understand which liens need immediate attention.
Stay informed about property rules and regulations in your area.

Frequently Asked Questions About Property Lien Search

What should I do if I discover a lien after buying the property?

You might be responsible for resolving it at your own expense. Title insurance can help mitigate this risk.

Can I buy a property with existing liens?

Yes, but ensure you understand the implications. Negotiate with the seller to resolve liens before closing.

Do liens affect my ability to refinance?

Absolutely. Lenders typically require a clear title. Existing liens must be cleared before refinancing can proceed.

How long does a lien stay on my property?

It varies. Tax liens remain until paid, while judgment liens may expire after a specific time period, depending on jurisdiction.

Is title insurance still necessary after conducting a thorough lien search?

Yes, title insurance protects against any hidden liens missed during the initial search, offering financial security post-purchase.