Lien facts for kids

A lien (pronounced "LEEN") is like a special "hold" or claim placed on someone's property. It's used to make sure a debt is paid back. Think of it as a promise: if you owe money, the person you owe can put a lien on something you own, like a car or a house. This means you usually can't sell that property until you pay off the debt.

A lien is usually a public record, so everyone can know about it. The person who owns the property with the lien on it is called the lienee. The person or company who is owed money and holds the lien is called the lien holder or lienor.

What is a Lien?

A lien is a legal way for a person or company (the creditor) to protect themselves when they lend money or provide services. If someone owes them money, they can put a lien on the debtor's property. This gives the creditor a legal right to that property until the debt is settled.

How Liens Work in the USA

In the United States, the word "lien" covers many different types of legal claims. It includes things similar to a mortgage, which is a lien on a house to secure a home loan. In the USA, a lien is usually "non-possessory." This means the lien holder doesn't actually take or keep the property. They just have a legal claim on it. For example, a bank that holds a mortgage on your house doesn't live in your house; they just have a lien on it until you pay off the loan.

Liens in Other Countries

In many other countries that follow common law, the term "lien" means something more specific. There, a lien often means the lien holder has the right to keep (or "possess") the property until the debt is paid. However, they usually can't sell the property. If they lose possession of the property, the lien is often released. This is different from the USA, where the lien holder usually doesn't possess the property.

Why are Liens Important?

Liens are important because they help make sure that debts are paid. They give creditors a way to get their money back if someone doesn't pay what they owe. For example, if a car repair shop fixes your car but you don't pay the bill, they might be able to put a lien on your car. This would mean you couldn't sell your car until you paid the repair bill.

Types of Liens

There are many different kinds of liens, depending on how they are created and what type of property they are on. Some common types include:

• Mortgage Liens: These are very common and are placed on real estate (like houses or land) when someone borrows money to buy it.
• Tax Liens: Governments can place these on property if someone doesn't pay their taxes.
• Mechanic's Liens: These can be placed on property by people who have done work on it (like builders or repair shops) if they don't get paid for their services.

See also

In Spanish: Derecho de retención para niños