David Saks: Real Estate Practice : Lesson 3619 (Liens)

David Saks - Real Estate Broker - The Real Estate Mart of Tennessee, Inc. - 4040 North Watkins-Suite #4 - Memphis, Tennessee 38127 - Phone (901) 357-4663

Real Estate Practice : Lesson 3619 (Liens)



A lien is another name for the spleen, but we're not talking spleens here.

Have you ever wondered what we mean when we say the lien is "statutory" ? Statutory liens are the types of liens that creditors will use get their hands on a security interest in your property which can satisfy your debt as allowed by state or federal laws. We have two very common statutory liens :

1. The Mechanic's Lien

2. The Tax Lien

When you try to sell any property which has a statutory lien placed on it, the creditor who filed the lien has to be paid from the proceeds of the sale before the lien is removed from the property.

Statutory liens are sometimes also referred to as "perfected", which means that the lien has been filed with the appropriate government agency or it can't be enforced. In most cases, the Mechanic's lien has to be filed within 60 to 90 days after any work is performed by the filer and usually acted upon within a years time frame in the county where the property is located.

In some cases, when a contractor is hired to perform work on a property they turn around and hire subcontractors to do the work for them. You pay the contractor, but the contractor doesn't pay the sub- contractor. I this case, the subcontractor can place a Mechanic's lien on your home. It's always a good idea to know who's performing the work on your home or property and you should always ask for a lien releasefrom any and all potential lien claimants before you pay your contractor.

Tax Liens, which I'll discuss a little later in more detail, are known to be filed up to two or three years after taxes become due and payable. If the taxes aren't paid and the tax lien isn't satisfied the government will foreclose on the property and sell the property for the value of the taxes.

Remember to speak with an attorney for more clarity.

What experiences have you had with contractors and liens? How do the tax lien sales work in your county?

David Saks

Time&Temp Memphis

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Comment balloon 1 commentDavid Saks • August 25 2014 04:38AM


David, We see our fair share of liens but we see the most liens when dealing with a self employed buyer or seller.

Posted by Sam Miller, Knox County Ohio Real Estate Specialist (RE/MAX Stars Realty) almost 6 years ago

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