A creditor on a civil judgment may be able to create a lien against the debtor's real estate to try to enforce payment. A real estate lien gives a creditor a form of interest in the debtor's real estate until the debt is paid. Creditors must follow local laws to create a real estate lien.
Attaching a Lien
A creditor creates a real estate lien against a debtor's property by following the procedures found in state laws. For example, the creditor may have to get a special copy of the judgment from the court that issued it and file that copy in the land records of the real estate's county. The lien will only affect properties located in that county. She may have to wait until a specific amount of time set by local law, such as 30 days after she received the judgment, before she can create a real estate lien.
The debtor will have to address the real estate lien if he wants to sell or get a home loan on his property in most cases. The creditor keeps his interest until the debt is satisfied or the lien expires. The lien's expiration date depends on the property's location. For example, a real estate lien is Ohio is good for five years from the filing date, with the possibility of renewal by the creditor for another five years. Other creditors, such as a lender with a loan on the home, may have legal priority for payment over the holder of a real estate lien from a civil judgment, which means the lender will be paid before you can collect.
The creditor may file a lien satisfaction or discharge in property county's land records to end the lien before its termination date. If the debtor owns multiple properties in the same county, the creditor can release a specific property from the lien without wiping out the lien on the debtor's other properties. Rules for partial lien releases vary by area but often involve the filing of a release document. The release itself specifies the judgment and what particular property is being released from the lien.
Homestead laws and protections may prevent a lien from attaching to a particular property, as defined by state laws. For example, in Texas, a real estate lien cannot attach to a debtor's homestead, or primary legal residence. In Ohio, a person may claim their homestead is exempt if the civil judgment is the result of an unpaid medical bill.