Posted on Friday, December 17th, 2021

selling your houseWhen selling your home, it is likely that a title search will be conducted on the property. This title search will reveal any voluntary or involuntary liens that were filed against the property. An Orlando real estate attorney can help you with your review of your title search results and can also give you some insight into how to properly address any liens filed against your property.

What Are Voluntary and Involuntary Tax Liens?

Voluntary Liens:

Basically, anytime a homeowner uses their property or the equity in their property to secure a loan, that loan securing the property becomes a voluntary lien. The rationale is that the lien is a contractually permitted lien that is agreed to by the owner of the property. In this circumstance, if the debt is not paid per the terms of the contract, the creditor may have certain remedies available to help recoup the debt that is owed, such as foreclosure. A common form of a voluntary lien is a mortgage loan.

Involuntary Lien:

An involuntary lien may attach to a property without the consent of the homeowner.  An example of an involuntary lien would be a municipal lien. In Florida, municipal liens are typically unrecorded and are imposed pursuant to Chapters 159 and 170, Florida Statutes. If the amounts owed remain unpaid by a property owner, the governing municipality would have the right to place a lien against the property.  Another type of involuntary lien relates to taxes.

When a property owner neglects to pay his or her property taxes, the applicable county or city will take the necessary steps to collect the past due balance owed. One of the measures taken is the filing of a tax lien against the real property that has the unpaid taxes. This tax lien would be a first position lien for unpaid real estate taxes, which would be enforceable against the real property. Furthermore, when a person neglects to pay his or her tax debt, the U.S. government may file a lien against any real property that is owned by that person. In this circumstance, the federal government would, ultimately, file a Notice of Tax Lien if the tax debt remains unpaid. This Notice would alert other parties of the federal tax lien and would also take priority over any mortgage that may secure the affected property.

With a real estate attorney Orlando, sellers who have liens filed against their property can be advised on what types of liens are on a property they have an interest in.

What Are Some of the Different Liens that Can Affect a Home Purchase?

Whether voluntary or involuntary, there are several types of liens. They often share the same core reason for existence, which is a non-payment or a default on a debt of some sort. Some further examples of property liens include:

  • Municipal liens for unpaid utilities, such as water or sewer
  • Community development district liens for community maintenance and operations
  • Mechanic’s liens for unpaid construction work
  • Judgment liens for unpaid court judgments
  • IRS liens for unpaid federal taxes
  • Condo and HOA liens for unpaid assessments
  • Family court or child support liens for unpaid alimony or child support liens

It is important to understand that some of these liens will show up in a title search, but some liens can come as quite a surprise because they’re unrecorded.

Real property taxes, municipal lien, other fees that may be linked to a specific municipality, may come from a city, town, village or port authority, which means these types of liens aren’t the same as voluntary liens such as mortgages.

Always look for knowledgeable real estate attorneys Orlando property investors trust. In this way, you can navigate the lien process with confidence.

What Can Someone Do About Property Liens?

If you plan to make a purchase, it makes sense to immediately contact an Orlando Florida real estate attorney to perform the searches and gather information on the property. While a municipal lien search can help, there are specific things that only a real estate law Orlando attorney can know to look for.

This can help save you time, effort, and money on the investment. It can also help you to understand if the purchase is one worth going through with or if it is one best left alone. If you plan to purchase an investment property or just a new home in general, contact Nishad Khan P.L., an Orlando Florida real estate attorney, to help you make an informed decision.