Placing a lien on real estate is a good strategy for collecting money that is owed to you. A key element in this strategy is making sure you have the legal right to place a lien. In most situations, your lien rights are based on either a civil court judgment against the property owner or a claim that you performed some type of construction work to improve the property at the owner's request. If the owner does not pay you in these situations, placing a lien could result in you getting paid.
Locate the appropriate form needed for the type of lien rights you have. For example, if you have a civil court judgment, you must obtain the form used in your state for placing judgment liens on real estate. In California, a form called "abstract of judgment" is used. You can obtain the form from the clerk's office where your court judgment was made. If your lien rights are based on working to improve the property, you must obtain a form used to claim these lien rights, sometimes referred to as a mechanic's lien or claim of lien. These forms are typically available from a legal stationary store or local builders' association.
Complete the form with the required information about your lien. For court forms, such as an abstract of judgment, you must bring the completed form to the courthouse for approval and issuance by the clerk before you can record it as a lien. Regarding a mechanic's lien or claim of lien, most states will require that your signature on the form is notarized before it can be recorded.
Mail a copy of your completed document to the property owner. After the mailing is completed, prepare a document called "proof of service" that you can attach to the original document before recording. The proof of service form can be obtained from the court.
Record your completed document with the local government office for maintaining property records, typically with a county, city or town office. Some municipalities use the local courthouse for maintaining these records. Because the requirements for recording a document will vary by location, you should contact the office to determine what you must do to record your document, such as the amount of the recording fees or whether the recording office requires a cover form for the document. Some offices, such as in Los Angeles County California, charge different filing fees depending on whether your document has a proof of service.
Having lien rights against a property owner gives you an advantage in collecting a debt from the owner that you do not want to squander by failing to act in a timely manner or incorrectly placing the lien. Consulting with an attorney in your local area may be a good first step to exercising your lien rights.
Do not place a lien on real estate unless you are certain you have the right to do so. Wrongfully placing a lien on real estate is called slander of title and it gives the property owner the right to sue you for damages. Some lien rights, such as a mechanic's lien, are complex and involve other requirements before you can rightfully record a mechanic's lien. Obtain legal advice before placing a lien on real estate when you are unsure of your rights.
- Nolo: Types Of Property Liens
- California Superior Court, Contra Costa County: How To Put A Lien On The Debtor’s Real Property
- Building Industry Association of Washington: How To File A Lien
- Nolo: Collect Your Court Judgment With A Real Estate Lien
- California Judicial Council: Proof Of Service By First Class Mail
- Los Angeles County Registrar-Recorder: Property Document Recording
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