If you’re a homeowner in Florida looking to sell your house but have substantial liens on the property, you might feel hopeless. Don’t despair—there are ways to work around a lien on your property.
Selling a home is never an easy process. It takes time, effort, and often some money to bring your house to a sellable condition. Buyers will often spot even the smallest defects in a home and use them to negotiate a lower price. If the paint needs touching up or the kitchen appliances are a few years old, a buyer will likely notice. Therefore, it’s important to get everything in order before listing your home for sale.
However, not all issues can be easily spotted and addressed. Some problems aren’t visible. For example, a lien on the property. Buyers won’t notice a lien while touring your home. It’s only during the closing process that they’ll learn about it and possibly back out of the deal. In some cases, you might not even know there’s a lien until it’s too late.
But don’t worry, all hope is not lost. If you need to sell your property but there’s a lien, there are still options. While a lien can reduce your profit from the sale, it doesn’t necessarily stop you from selling. In this article, we’ll explain what a lien is, what it means for your property, how to work around it, and how to sell your home despite it. Let’s get started!
What Exactly Is a Lien and Where Did It Come From?
If you’re not familiar with liens, don’t worry. We’ll explain the concept from scratch. If you already know what a lien is, feel free to skip ahead to the section on how to handle it.
A lien is a legal claim placed on your property by a third party, meaning someone other than you can claim ownership of your home. It’s similar to a negative mark on your credit report. If you miss payments, a creditor will place marks on your credit, which can hurt your credit score until the debt is paid off.
The same principle applies to your home. While foreclosure is a more common consequence of missed mortgage payments, liens can also come from other sources. For example, contractors may file a lien if you fail to pay them, or the government may place a lien for unpaid property taxes. Even an ex-spouse can file a lien if you haven’t been paying child support.
What Does a Lien Mean for My Property?
The main question here is: “Can I still sell my home if there’s a lien on it?” The answer is yes, but there will likely be setbacks. You’re not prevented from selling, but the lien will need to be addressed during the process. You won’t be able to walk away from the sale with the full amount you expected if there’s a lien involved.
For instance, if a buyer offers $225,000 and you owe $130,000 on the mortgage, you’d typically have $95,000 left after paying off the mortgage. But if the government has placed a $10,000 lien on your property for unpaid taxes, you’ll need to pay that lien off first. This means your remaining profit will be $85,000, and you’ll also need to account for closing costs.
In some cases, there might not be enough equity in your home to cover the mortgage and liens. This could mean that whatever profit you hoped to make from the sale would go toward paying off debts, leaving you with little to no profit.
Let’s consider another scenario: A buyer offers $225,000 for your home, but you still owe $180,000 on the mortgage. You accept the offer, but then several liens are discovered, totaling $50,000. After paying the mortgage, you’ll only have $45,000 left. That $45,000 would need to go toward paying off the liens, leaving you with no remaining funds and possibly causing the sale to fall through.
Getting Rid of a Lien
Now that we’ve explained what liens are and where they come from, let’s discuss how to remove them. The best way to get rid of a lien is to pay it off. Once it’s paid, the lien will be removed from your property’s title, and you’ll be clear to sell. Unfortunately, not everyone has the resources to pay off liens in full. If you’re in that situation, don’t lose hope.
Since a lien represents a monetary sum, you can try negotiating with the party that placed the lien. Often, creditors will understand that you can’t pay the full amount and may be willing to accept a partial payment or set up a payment plan.
Another option is to discuss the lien with potential buyers. While it’s unlikely that a buyer would agree to take on your lien, it might be worth asking. Keep in mind, however, that lenders are usually reluctant to finance buyers who are taking on liens.
In some cases, liens are included in the buyer’s responsibilities when buying a home at auction or during foreclosure. While the buyer may get a better price, they could end up inheriting substantial lien debts.
If you’re not willing to sell at auction or let your property go into foreclosure, consider working with a professional service. Some companies buy homes with liens attached, at a fair price, with the intention of fixing them up and reselling them later.
Selling Through a Real Estate Solutions Company
Mid-Florida House Buyers is a real estate solutions company, not a traditional real estate agency. We don’t act as an intermediary to sell your house. Instead, we act as the buyer. We assess your situation and determine if we can help. This often includes homes facing foreclosure, requiring repairs, or burdened by significant liens. We make cash offers, close the sale through a legal process, and then fix and flip the house for profit.
While it may sound too good to be true, keep in mind that selling through us might not yield as much profit as selling through traditional methods. For some, however, getting any amount at all can be better than struggling with liens or foreclosure.
So How Does This Work for You?
The process is simple. First, you provide basic personal information and details about your home. We’ll then assess how we can best assist you. We need to know the address, the number of bedrooms and bathrooms, the condition of the property, and whether you or a tenant occupies it.
If your home meets our criteria, we will arrange a time to visit and inspect the property. We will spend about 30 minutes taking photos, assessing the repairs needed, and determining the home’s value. After this, we’ll make a fair cash offer.
We are completely transparent about our offer. What you see is what you’ll get—there are no hidden fees or commissions. Unlike other companies, we don’t take a portion of your sale price for ourselves.
That said, it’s important that you’re honest about your home’s situation. If you’re not upfront about any liens or other issues, we might not be able to provide an accurate offer, and you may end up paying off outstanding debts out of the offer amount.
If you accept our offer, we’ll work through the legal process with an attorney, and your sale will close. At that point, the house is no longer your responsibility. Just pack up and move out—we’ll take care of everything else. No need to fix anything or clean up. Once the closing papers are signed, you’ll be free of your obligation.
Closing Thoughts
Selling a home is never easy, and dealing with liens can make it even more difficult. However, if you’re worried that a few outstanding debts will prevent you from selling, don’t lose hope. You can try negotiating with creditors, speaking to potential buyers, or working with a real estate solutions company.
We offer no-hidden-fee, straightforward cash offers. Whether you have liens, need repairs, or are facing foreclosure, we are ready to help.