Liens can be a significant source of frustration by hindering property transactions and damaging credit scores. However, there are ways to alleviate or eliminate this burden.
What is a Lien
A lien is a form of debt that gives the creditor a legal claim to your property if you fail to repay as agreed. For example, in the case of mortgages, a mortgage agreement places a lien on a home in favor of the lending bank. This information is typically filed with the deed. Failure to make payments may result in foreclosure.
For car loans, the financier can repossess the vehicle if monthly payments are not made. Car liens are usually noted on the vehicle's title.
The Internal Revenue Service can also impose liens for unpaid taxes. If tax debts remain unresolved, the IRS can place a lien on all your property. Before doing so, they must file a Notice of Federal Lien in your county. This legal warning is similar to the mortgage deed or car loan notation. An IRS lawyer at Margolies Law Office can offer solutions for IRS-related issues that may not require full debt repayment.
Resolving Liens
Obtain a Certificate of Release
This can be achieved if the debt is paid off in full, if it has become legally unenforceable due to the statute of limitations, or if you submit a bond conditioned on the payment of the debt.
Obtain a Certificate of Discharge
This allows you to free up your property for sale even without paying off the debt. Specific conditions must be met, such as entering an installment agreement.
Obtain a Certificate of Subordination
In certain situations, the IRS may agree to subordinate its lien. This can help you secure credit or purchase a house.
Withdrawal Notice
Before the IRS files the Notice of Federal Lien, it has no effect on your credit and generally does not impact your life. Once filed, your credit can suffer, and you may face obstacles when trying to buy or sell a property. If specific conditions are met, the IRS may agree to "unfile" the notice, which often results in the lien being removed from your credit report entirely.
Call us to speak with us about your lien issues.