Jasz
VIP Contributor
Lien is a legal charge over property to secure the payment of a debt or performance of an obligation. It is generally used as a security interest over real property, and in some jurisdictions, intellectual property. A lien is a right to keep possession of or ownership of property until the debt is paid. The right may be enforced by legal action (Garnishment) against third parties who are holding that property for the debtor.
Liens are often created by state law and they vary from state to state. Liens can be classified into two types- voluntary and involuntary. Voluntary liens are those which arise from contract where both parties agree on it while involuntary liens arise when one party has not agreed to it but still has some benefit out of it.
In general, lien is used as a security interest over real property, but in certain jurisdictions it may also be used as security interest over personal property like accounts receivable, inventory etc.,
A mortgage lender can claim a lien on your home if you don't pay your debt on time.
Liens are often created by state law and they vary from state to state. Liens can be classified into two types- voluntary and involuntary. Voluntary liens are those which arise from contract where both parties agree on it while involuntary liens arise when one party has not agreed to it but still has some benefit out of it.
In general, lien is used as a security interest over real property, but in certain jurisdictions it may also be used as security interest over personal property like accounts receivable, inventory etc.,
A mortgage lender can claim a lien on your home if you don't pay your debt on time.