Step 5 - Property Lien

Each state has its own laws on how you will go about filing a lien on the person’s property or bank accounts if possible. You will need to check with your county courts on how you would go about filing a line.

All states do require you to file your documents with the court. A Judge will issue a Judgment Lien that you can take to the county recorder’s office and file with the county recorder.

Some states require you to send the person a notice that a lien has been filed against them for non-payment of the debt they owe to you.

What is a Lien?

A lien is a legal claim against an asset, often a property or a vehicle. A lien is most commonly used as collateral for the payment of a debt. With a lien, a lender has the security of knowing that if the Debtor or Government official doesn’t follow through on satisfying the debt owed to you that you have a legal claim to an asset.  Individuals can file a  lien against the person who owes them money and receive a legal judgment through the court.

What are the Different Types of Liens?

There are a variety of liens to secure different types of assets. Here are some of the common liens that people file against:

  • Mortgage or Property
  • Automobiles
  • Judgment liens
  • Tax liens


The type of lien used will depend on the asset that is being used to satisfy an obligation.

How do File a Lien?

Filing a lien is a serious legal move and should only be done after exhausting all other options to be paid. It is first recommended that you reach out to the party who owes money to attempt to set up a payment plan or another way to collect payment. Hiring a debt collection agency is another way to avoid the formal legal process of filing a lien.

If all attempts to be paid fail and filing a lien against the other part is the final option, certain steps must be completed to file your lean.

Step 1: Preliminary Notice

Depending on your state laws, you may be required to notify the debtor that a lien will be filed if nonpayment persists. Some states have a form that must be filed to give notice that can usually be obtained from the clerk of courts. Other states may have time restraints to give notice.

Many states require that preliminary notice of a lien must be given within 10 to 20 days of the work began. This does not apply to the affidavit process.

Due to the variations in state laws, if you are unsure about whether you need to fine a notice or how many days you must notify the debtor, you should check with the courts right away after sending out your last notice of default to pay your invoice.

Example letter of Notice of Claim of Lien.

Step 2: Review Deadlines

Each state imposes a deadline in which you must adhere to if you decide to file a lien. Again check with the court after sending out your notice of default to pay your invoice.

The state statutes for each state are different. In most cases the clerk at the county court house should be able to answer your questions. 

Most deadlines state impose on filing a lien deal with construction liens. 

Step 3: Research the Property

If you plan on filing a lien on a property, you will have to complete some research prior to filing. You will need to complete a title search to verify the actual owner and acquire a legal description of the property from the deed.

This process can cost a few hundred dollars and it is important to note that if there are other liens currently on the property, they will take priority over your lien which could prevent you from collecting on the debt.

Step 4: Draft a Lien

Once you have decided to file a lien and have completed the research necessary, it is time to draft the lien document. A lien is usually a short one-page document that includes the following information:

  • Creditor details
  • Debtor details
  • Property details

Many states provide forms that can easily be filled out but some states require additional documents like affidavits to be filed with the lien. To ensure you have all the documents necessary to file your lien in your state and that your lien documents are complete you should check with the courts before filing your lien.

Example letter Notice of Lien Filed

Step 5: File the Lien.

Depending on your state, you will need to file the lien with either the property recorder’s office or the clerk of the court. If you are filing a lien on a property, it must be filed in the county in which the property is located. Most jurisdictions charge a filing fee between $25 and $50.

Step 6: Enforcement

After the lien is filed, if the debt isn’t paid, you can enforce the lien by filing a foreclosure lawsuit against the property owner. This will force the property to be sold and the proceeds will go towards the repayment of the debt.

Example letter of Partial Release of Judgment Lien. If the person agrees to monthly payments it is possible that you can release a portion of the lien on the property after receiving multiple payments on the debt. 

This is something that you can work out with the Debtor after filing your lien. Furthermore, this is up to the Lienholder if they wish to release partial judgment on the lien that has been file4d. 

Each state has laws regarding the amount of time you have to file a foreclosure lawsuit, but most states allow a year. If you don’t file a lawsuit before the end of the enforcement period, your lien is expired and no longer has value.

Filing a foreclosure lawsuit can be a very complicated and time-sensitive process. It is recommended that you consult with an attorney to ensure that all deadlines are met, the lawsuit is filed properly, and you are compensated for the debt owed.