Learn About a Lien and How It Can Affect the Ownership of Your Title
Buying a new home is an exciting experience. However, the experience can seem intimidating for new homebuyers and result in these homebuyers overlooking crucial details during the process. For this post, AREA Title Agency, Inc. has some information on one important process, a title search, and how an undiscovered lien can affect your homeownership.
What Is a Lien?
A lien is an official note placed against the title of a house or property in the event a previous owner provides the title as security against a line of credit, such as a mortgage of personal loan. When a creditor places a lien on a property and the owner of the title does not continue to make agreed repayments against their debt, the creditor can sell the property to recover any owed debt.
How Can It Affect You?
While a lien has little effect as you look to purchase the property if the creditor does not remove the lien before the settlement then it can result in the foreclosure of your property. In the situation mentioned above, the owner/occupier is directly affected should they cease to make payments. In the event the title has transferred, they have little reason to continue their repayment obligations. Situations such as this could leave you in a position where their creditor is seeking the immediate sale of the property, now under your ownership, for the purpose of recovering the owed debt.
Protect Yourself Against a Lien With Title Insurance in Toledo, OH
Before settlement, speak with AREA Title Agency, Inc. at (419) 242-5485 and request a thorough title search. When AREA Title Agency, Inc. completes this search, it can uncover any liens placed against the title of your soon-to-be property. If your title search does not reveal any liens, it is advisable to obtain a title insurance policy which provides you with financial protection in the event a creditor makes a claim to ownership against the title of your property.