If you have the financial means, this can be a great time to buy.  By the same token, there are aspects to this market that indicate you should check lien files before deciding to buy a home.

What is a Lien?

A lien is a legal claim by a person or entity on the property of another.  This can be in the form of financial obligation or some other type of debt.  Regardless of the form it takes, what it comes down to is that a person with a lien on her property does not have the legal right to sell it.

As a rule, a lien should preclude the “owner” of the home from ever putting it up for sale.  However, this does not always happen.  There are at least two reasons for this.

1. The first is that the seller is dishonest, in debt and hopes to get out from under it by leaving someone else with the problem.  Ideally the real estate agent should have checked lien files before listing the property, but it is an imperfect world.
2. Another cause is that the seller may not know there is a note against her home.  This usually happens in the case of divorce, where one spouse has put the home up against a debt without informing the other.  The legal complications that result are myriad.

The Best Way to Conduct Lien File Research

Because it is possible for this information to slip through the cracks, you need to check lien files before closing on a house.  There are few things worse than finding your family on the street because the property legally could not be sold. Using an online database may be the most efficient way of making sure this does not happen.

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