In a normal market or a buyer's market, the buyer hopes that the seller will accept an offer that is lower than current market value, but high enough to allow the seller to get out of their mortgage debt without bringing money to the closing table. Short sales are a little different.
Short sales are more common in areas with high foreclosures or job losses. Banks have a lot of inventory on hand and are more willing to negotiate but they put the deal under a microscope. The buyer has to understand and be prepared for a deal to take much longer, perhaps as much as three weeks longer than normal.
The seller must prove hardship for the lien holder to agree to take the loss. There are three ways buyers can find out what the seller owes -- public records, real estate professionals and asking the seller directly. The amount owed on any mortgage is a matter of public record and can be found at the County Recorder. Buyers can search in person or online, where county records are available.
The easiest way to remove a lien is to pay the outstanding debt, either in full or by agreeing to a payment plan.
Liens are filed with the county office and sent to the property owner advising them of repossession of the asset s. Liens can be general or specific, and voluntary or involuntary.
Not usually. Before you close on a home, your attorney or title company should perform a title search to make sure the title is free of liens, back taxes, and other claims. Liens are a matter of public record. All homeowners have liens on their homes until they pay off their mortgages. Internal Revenue Service. Federal Trade Commission. Accessed Sept. Debt Management. Loan Basics. Building Credit. Real Estate Investing. Your Privacy Rights. To change or withdraw your consent choices for Investopedia.
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Your Money. Personal Finance. Your Practice. Popular Courses. Part Of. Getting Ready to Sell. Selling Strategies. Real Estate Agents. The Owner-Seller Option. The Selling Process. Tax Consequences. Definitions A-O. Definitions P-Z. Home Ownership Mortgage. Table of Contents Expand. What Is a Lien? Types of House Liens. Do Liens Hurt Homeowners? A Word About Credit Scores. Property Tax Liens. How to Remove a Lien. How Do Property Liens Work? The Bottom Line.
Tax liens are no longer reportable, but other involuntary liens may impact your credit score. Homeowners can remove liens by making payment arrangements or settling debts. Article Sources. Investopedia requires writers to use primary sources to support their work. The lender accepts the selling auction price as full payment of the debt.
Craig Woodman began writing professionally in Woodman's articles have been published in "Professional Distributor" magazine and in various online publications. He has written extensively on automotive issues, business, personal finance and recreational vehicles. Woodman is pursuing a Bachelor of Science in finance through online education. At the center of everything we do is a strong commitment to independent research and sharing its profitable discoveries with investors.
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