How to check liens on a property before making an offer

What a lien is, and why it matters to a buyer

A lien is a legal claim against a property that secures a debt. Most liens stay with the property when it's sold, so they have to be paid off or released before the buyer gets clear title. In a normal sale the escrow or title company pays them from the seller's proceeds at closing, and you never see them.

Liens matter before you offer for two reasons. First, if the liens add up to more than the likely sale price, the seller can't close unless the lienholders agree to take less or the seller brings cash to closing, and the first usually means a slow, uncertain short sale. Second, some charges, like special assessments and direct charges on the tax bill, continue after the sale, so they show costs you would take on as the next owner.

Common types of liens on a home

• Mortgages and home equity lines. The most common liens. A second loan or HELOC is another lender that has to be paid at closing.
• Property tax liens. Unpaid property taxes generally become a lien and usually come first in line.
• Special assessments and direct charges. Some areas add bond or improvement charges to the tax bill (for example Mello-Roos or community facilities district charges in California, or PACE financing for energy upgrades). Some of these continue after the sale, and many mortgage lenders require a PACE balance to be paid off first.
• HOA liens. Unpaid dues or assessments can become a lien, and in many states the HOA can foreclose on it.
• Mechanic's liens. Filed by a contractor or supplier who wasn't paid for work on the home.
• Judgment liens. A court judgment against the owner, recorded in the county, can attach to real estate the owner holds there.
• Federal and state tax liens. Recorded for an owner's unpaid income or other taxes.
• Municipal liens. Unpaid utilities, code enforcement fines or nuisance abatement charges, depending on the city.

How to check liens before you make an offer

1. Get the parcel number (APN). It's on the county assessor's site, searchable by address, and often in the listing details. Most county records are easiest to search by it.
2. Check the county tax collector. Look at the current bill, whether past installments were paid on time, any delinquency or penalties, and any direct charges or special assessments listed on the bill.
3. Search the county recorder. Look for recorded mortgages, deeds of trust, judgments, mechanic's liens, tax liens and releases. Many recorder indexes are searchable only by the owner's name, so you may need the owner's name from the assessor's records. A lien with a recorded release has been paid off or otherwise cleared.
4. Look for foreclosure notices. A notice of default, notice of trustee sale or lis pendens (a notice of a pending lawsuit) means a foreclosure or other legal claim against the property has started.
5. Ask about the HOA. If the home is in an HOA, ask the listing agent whether dues are current and whether any special assessment is in progress. The HOA's resale documents will confirm the balance later.
6. Check the city. Some cities show open code enforcement cases or permit problems online. Unpermitted work and open violations can lead to fines and liens.

What you find here shapes your offer and your contract terms. It doesn't replace the title search.

A worked example (hypothetical numbers)

Suppose a condo is listed at $280,000. The numbers below are made up to show the reasoning; they aren't from a real property.

What this suggests: the delinquent taxes, back dues and mechanic's lien would all normally be paid from the seller's proceeds at closing, so they aren't the buyer's bill, but they are signs of a seller under financial strain. The roofing company's lien is also a reason to ask whether the roof work was finished and paid for. Two open loans plus the other liens could add up to more than the sale price, which would make it a short sale that needs lender approval. The $600 a year charge is different: it continues after the sale, so it belongs in the buyer's monthly cost. A buyer here might ask the agent whether the loans are covered by the price, make sure the contract requires all liens to be paid at closing, and budget for the ongoing charge.

This is an illustration of how to read lien records, not legal advice or a review of any real property. Your title company, agent and, if needed, a real estate attorney can tell you how a specific lien will be handled.

What only the title report can confirm

After your offer is accepted, the title company searches the records and issues a preliminary title report (sometimes called a title commitment). It lists the owner of record, open loans, liens, judgments, easements and other items, and what must be cleared before your title insurance policy is issued. Read it carefully, ask about anything you don't understand, and make sure every lien will be paid off or released at closing, and that you understand any easements or other items that will stay with the property. Owner's title insurance protects you against covered problems the search missed.

Common mistakes when checking liens

• Assuming public records are complete. Indexes can be hard to search, names are misspelled, and some liens are recorded late.
• Ignoring ongoing charges. A special assessment or district charge on the tax bill can follow the property, not the seller.
• Skipping the HOA check. Back dues and assessments are easy to miss and can delay closing.
• Waiving the title review period. Keep enough time in the contract to read the preliminary title report and object to problems.
• Treating a lien as a reason to walk away. Most liens are routine and are paid at closing. What matters is whether the sale price covers them.

Where a BidWise Home report fits

A BidWise Home buyer report covers the screening steps for one address and your offer price: it checks the county tax collector for the current bill, payment history and direct charges, looks for foreclosure notices, notes what could and couldn't be checked for recorded liens, and flags anything that needs the title report. It also covers fair value from comparable sales, listing history, HOA dues and monthly cost. If you're looking at a distressed sale, see our guide on how much to offer on a short sale. Reports are $10 each and are not a title search, appraisal, inspection, or legal or financial advice.