You can sell your home with a lien on it in California, but the sale process may be slower and is rife with potential pitfalls. There are ways to make selling a house with a lien on it easier, and SoCal Home Buyers has produced this guide to help you with that process.

You should know what types of property liens you may be dealing with, the process for getting rid of each of them, and what the consequences might be if you are unable to remove your lien. If you’re in the market for a new home and wonder if buying one with a lien on it will be worth it, this guide will be of use to you as well.

Read on to find out how to check if there is a property lien on your home, what to do if you find out there is, and how to proceed with the sale process even if your home has a lien.

Key Takeaways

  • There are many different kinds of property liens with different levels of importance to the sale process.
  • You can sell a home with a property lien on it, but this is unlikely unless you are very lucky.
  • The best way to sell a house with a lien on it is to get rid of the lien first.
  • Checking for liens is easy, so you should always assume that buyers will find out on their own about the lien even if you don’t tell them.
  • SoCal Home Buyers can help you sell your property even if it has a lien.

What is a Lien?

A lien is a legal claim against your property that can be enforced if you fail to pay a debt owed to the lien-holder.

For example, a mortgage lien gives the bank the right to take possession of your house with a lien if you do not make your mortgage payments on time. In this case, the bank can take possession of the property and sell it to recover their losses.


See: California Code of Civil Procedure section on Liens.


Liens are tied to the property and not individuals.

For this reason, it is possible to transfer a property with a lien and be free of it in some cases, though most buyers will be wary of properties with liens against them.

Not All Liens Are Bad. What’s the Difference?

Liens exist to protect debtors from unpaid debt. They allow a property to change hands from a debtor to a creditor to protect the value of a loan.

There are many different kinds of liens. Mortgage liens are common and do not negatively impact you or your sale prospects.

They simply exist as a form of security for the bank and will not be enforced as long as you make your mortgage payments regularly. Others, like a judgment lien, can significantly affect your credit score or even your financial future.

These liens are reportable to credit bureaus which can affect your ability to secure credit in the future, any businesses you may own, and even your ability to obtain and keep a job.

Voluntary and Involuntary Liens

A voluntary lien is a one knowingly entered into by the creditor and debtor in which a property is used to secure the value of a debt. A mortgage is an example of a voluntary lien. Most kinds of liens are involuntary.

Involuntary liens are sought in response to unpaid debts. This includes liens for things like legal judgments, unpaid taxes, or unpaid construction fees from a contractor or architect.

involuntary-voluntary-liens

General & Specific Liens

Liens can be placed against specific properties, known as specific liens, or an entirety of a debtor’s property, known as general liens.

general vs specific liens

Primary And Secondary Liens

There are many channels of communication occurring simultaneously during a home sale.

For example, you have the seller’s agent, buyer’s agent, lenders, appraisers, inspectors, and a legal team all sending emails and messages back and forth.

You’ll sometimes not hear about updates or changes immediately. However, you can communicate with each channel directly when you don’t work with a realtor.

This gives you more control over decisions, ensures you receive updates on the latest changes, and gives you more power for negotiation when questions arise.

The Different Type of Liens

There are several different types of property liens, but all are nearly identical in function. The most common example as mentioned earlier is the mortgage lien which is the least complicated and also not considered a burden on the sale of a home.

All other types of liens are the result of unpaid debt. Some of these are re-portable to the credit bureaus, meaning they can and will affect your credit score in addition to the sale of your property.

selling property with irs lien

Some of the different kinds of liens are:

  • Mortgage Lien: The most common kind of lien, usually held by a bank to secure the value of a home loan.
  • IRS Tax Lien: Can be placed on a home if the owner has past due property taxes. An IRS tax lien can take precedence even over a mortgage. NOTE: Even without paying your back taxes. If you have other properties, the IRS may be willing to transfer their property tax liens to one of them so that you can sell the property in question.
  • Property Tax Lien: Like IRS tax liens but for county property taxes.
  • Judgement Lien: Issued via court order. These types of liens are reportable to credit bureaus. Includes things like child support and alimony debt.
  • HOA Lien: In some cases, your HOA may be able to put a lien on your property for failure to pay dues or fees. Check with your covenant and local laws to determine if this is possible.
  • Mechanics Lien: Also known as a construction lien. Will be placed on a property by a contractor or home designer for unpaid work.

How to Sell a Property with a Lien on it

For the vast majority of home buyers, a home with a lien on it is a red flag that signals to run far away. There are some exceptions to this rule.

For example, a real estate developer who may be willing to take on a lien in the interest of expediency.

However, the average commercial home buyer will not want a home with a lien because they would be taking on unnecessary debt. This means that your best bet for selling a property with a lien on it is to get rid of lien before listing the home.

sell house with lien

Remember that liens are public record and potential buyers can easily check with the county recorder or title company and confirm if your property has a lien.

Try one of these steps before listing your property with a lien for sale:

1. Pay the Lien Off Before Listing

The simplest way to deal with a lien on your property is to pay it off before listing the home. If you are able to do this, ensure that you get a copy of your lien release letter from the debtor as soon as your payment has cleared.

This will allow you to move forward with the sale process and show potential buyers that the title is in the clear. For various reasons this may not always be possible for all sellers.

In those cases, we recommend one of the following steps:

2. Pay the Lien Off Via Sale Proceeds

If you have enough equity in your property, you can use the proceeds of the sale to pay off the lien.

For example, if you are able to sell the property at a profit of $100,000, but have a $20,000 lien against it, you can just use the profit of the sale to take care of the debt and clear the title for your buyer.

This is most likely the best option for homeowners who have accumulated some equity over the years but don’t have the money to pay down their lien all at once without selling the home first.

If you decide to try this route, make sure to keep open communication with any buyers. Remember that anyone interested will be able to find record of the lien on their own. Serious buyers will want to know what you plan to do about the lien before discussing buying your property.

3. Negotiate a Settlement or Payment Plan

If you know you don’t have the liquidity or equity required to take care of the lien before or during the sale, you can try contacting the lien-holder directly and negotiating with them.

It may be possible to get them to release the property from the lien, allowing you to proceed with a sale, in exchange for a settlement payment or a payment plan.

The success of this step will depend on the kind of lien on the property and how skilled you are at negotiating.

4. Get the Buyer to Take the Lien on

While technically possible depending on the buyer, this is unlikely to work unless you have some extraordinary leverage like a time-sensitive development or a particularly valuable property.

Since liens are technically tied to properties and not people, they can be transferred upon sale of a home.

Remember that the buyer can easily find out if there is a lien on the property before buying the home, so you will definitely need to be open and honest if you plan to convince them to take on the debt.

5. Dispute the Lien to Remove it From the Property

If you have good reason to believe the lien is illegitimate in some way, you can take the matter up with the courts and try to get it dismissed.

The lien-holder will be required to prove that the lien is legitimate, or “perfect” the lien, in court.If your challenge is successful, a judge may order the lien dismissed.

For example, in California, judgment liens are subject to statute of limitations of 10 years. If you believe you have cause to have a lien dismissed from your property, contact the title company or an attorney to begin the dispute.

6. Contact SoCal Home Buyers and Let Us Make It Easy on You

Can you sell a house with a lien on it? It is absolutely possible, but it may be a hassle that you decide is more trouble than its worth.

SoCal Home Buyers has years of experience and has helped hundreds of homeowners sell their homes with liens on them.  Contact us today to and let us take the stress out of selling your property even if it has a lien on it.

how to sell a house with a lien

A Lien Is an Obstacle, not a Dead End

If you’re interested in selling your property but know if it’s covered by a lien, you shouldn’t give up hope. Contact us and let one of our experts check if your property can still be sold in spite of its lien.

We may be able to eliminate the hassle and stress while still helping you sell your house fast with a lien on it by buying it as-is for cash.

Depending on the circumstances of your lien it should still be possible to sell your home fast, especially if you’ve accumulated enough equity over the years to cover the amount of the debt.

Even if you don’t have the money to clear the title or the equity to cover the debt, there are other ways of negotiating with buyers and creditors which could keep the door open for a sale.

No matter what you do, don’t forget that the lien is a matter of public record and can’t be ignored.

You will need to formulate a plan to satisfy the lien before committing to the sale of your property, or else any serious buyer will not be interested.

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Frequently Asked Questions

We’ve collected and answered some of the most frequently asked questions regarding selling properties with liens.

You become responsible for the property lien. Property liens are tied to properties, not people, meaning they can be transferred via sales.

This is unlikely to happen unless you buy the home at auction after a foreclosure or are an experienced and serious investor who knowingly took on a lien for other reasons.

You can always check a property for liens in advance with the county recorder’s office or the title company.

If you’re a commercial home buyer, it’s best to avoid properties with liens as they can only add to your complications and slow down the closing process.

Pay the lien-holder off or dispute the lien. You can also contact the debtor directly to negotiate a solution. For example, some creditors may be willing to drop property liens if you agree to a payment plan.

If you have an IRS Tax Lien, you can apply to have it removed from the property by filling out this form from the IRS’ website.

Generally, the IRS will only consider this if you have some other means for them to collect on the debt like another valuable property or asset.

This depends on the lien amount. In general, it should not cost more than the amount of the debt covered by the lien.

If you are more than five years delinquent on your taxes and not enrolled on a payment plan, the state of California may auction your lien to investors at an annual property tax deed auction.

In this case, you could owe additional fees and interest to investors who now own your lien.

You can only if the buyer agrees to it. This is an unlikely circumstance, especially if you’re selling a home to normal retail buyers who will not want to deal with properties that have liens on them.

However, if a buyer is willing to take on the lien it is possible to have it transferred to them in some circumstances. In general, if your debt will be satisfied by the proceeds of the sale of a property, you will be expected to pay your creditor back during the process of the sale.

Lien-holders are legally empowered to enforce liens when debts go unpaid and take possession of the property covered by the lien. They may then sell the property.

The simplest example of this is a property owner who fails to make their mortgage payments. In this instance, the bank as primary lien-holder will be entitled to take possession of the home and sell it to recoup their losses.

Most lien-holders will be more interested in working out a payment plan with you than going through the trouble of enforcing a lien.

Open communication with your lien-holder could be the difference between an amicable settlement and an enforced lien.

Judgments which allow a debtor to attain or enforce a lien against your property can happen without your presence.

In general, you will get notice from the creditor well in advance and they will probably try to settle with you before going down the legal route. If they can’t, they’ll try to open a lien.

If you think you may have a lien on your property, check with your title company or your county recorder’s office.

As soon as a debt which is supporting a lien is taken care of, the lien-holder will go through the process of removing their claim from the recorder’s office.

While this process is underway, you can request a letter from the lien-holder which acknowledges the paid debt and the release of the lien.

You should be able to use this lien release letter to complete transactions and show good faith buyers that the lien is taken care of.


The simplest way to find out if a property has a lien is to contact the county recorder’s office. Liens are matters of public record so they will have documentation of the lien on file here.

You can also contact the title company who can run a search on the property. A clean title is a requirement for most sales, so this step is unavoidable for anyone interested in buying property.