Selling a house involves numerous challenges, even in the best market conditions. When you have a lien on your property, the process becomes even more challenging and stressful. Many homeowners feel stuck when hit with liens and wonder if they can continue their property sale plans.
Yes, you can sell a house with a lien
A lien can make selling your property more difficult but not impossible. A lien is a legal claim against your property or essentially a “hold” on your house’s title.
It gives another party the right to part of your property’s value. It tells interested buyers that your property doesn’t have a clean title—something most traditional buyers consider non-negotiable. Additionally, mortgage lenders typically refuse to finance properties with outstanding liens.
How to move forward with selling your home
If you don’t pay off the debt first, the lienholder’s claim remains attached to the property, even after ownership changes. The new owner can become responsible for the previous debt. This is why most buyers hesitate to purchase a property with liens.
Here are some ways you can sell a house with a lien:
- Pay the lien first: Clear the debt before listing your property
- Negotiate with lienholders: Work out a reduced payoff amount
- Use sale proceeds: Arrange to pay liens from your closing funds
- Find a cash buyer: Some investors purchase properties despite liens
- Short sale option: Request lender approval to sell for less than owed
Each option has distinct advantages and challenges, requiring careful consideration of your situation.
Seek professional help for a smoother property sale
While liens create extra hurdles in your house sale, you have several viable options to complete your transaction. Working with a qualified legal professional may help smooth things over even more. They can help evaluate your liens, communicate with creditors and explore ideal selling options based on your needs or situation.