What is a Lien in Pennsylvania?
In Pennsylvania, a lien guarantees the settlement of loans and fulfillment of contractual obligations. A lien also ensures that money lent to a borrower is secured with one or more of a debtor's assets. This means that the asset's owner cannot sell or transfer the asset to another person until all debts are paid. The owner or debtor is a lienor or lessee, while the creditor is a lienor or lessor. Liens are public records, supplying potential borrowers and others with information on existing debts.
Even though there are different types of lien, they can be classified as general or specific. A general lien is not tied to a particular asset. Instead, it is attached to all of the borrower's assets, including houses, bank accounts, cars, and other properties that belong to the borrower. Hence, if the debtor defaults, the lender can sell any of the debtor's assets to recover the loan. On the other hand, a specific lien is attached to a particular asset offered as collateral in return for a credit or loan. All liens, regardless of their type, are enforced by judicial order issued by the Pennsylvania court.
Are Liens Public in Pennsylvania?
In Pennsylvania, liens are public information and are available for review by any individual or business. Liens are typically filed with the county recorder of deeds in the county where the property is located, who processes requests to view or copy them. Once a lien has been recorded with the county’s office of records, it will remain until either the debt has been paid off or until it has expired. In most cases, liens do not expire unless released or discharged by the creditor who placed it or by an order from a court. However, while liens are public records, other financial information related to an individual or business including credit history and bank accounts remain private.
Types of Lien in Pennsylvania
There are various types of liens in Pennsylvania, including child support liens, criminal liens, mechanics' liens, real estate tax liens, tax inheritance liens, environmental protection liens, etc. These liens can be classified into two broad categories; voluntary or involuntary liens and general or specific liens.
A specific lien is a lien placed on a particular property subject to foreclosure. An example of a specific lien is a mortgage lien. On the other hand, a general lien is placed on one specific property and other personal properties of the lienee. An example of a general lien is a tax lien.
A voluntary lien is an agreement between the lienee (borrower) and the lienor (lender) to give the lienor the right to a property until the debt is cleared. The agreement usually includes a clause to sell off the property where the financial obligation is not met as at the time stipulated. On the other hand, an involuntary lien results from the state's laws, so the lienees have no choice but to accept such liens attached to their properties.
In Pennsylvania, the agency in charge of administering general liens to taxpayers is the Department Of Revenue. On the other hand, specific liens can be administered by any other agency with requisite authority on the lienee's personal property.
How Do I Check for Liens in Pennsylvania?
The quickest way to check for liens in Pennsylvania is to visit the Pennsylvania Centre County official website and look up the lien records available there.
In Pennsylvania, liens are public records uploaded on the assessor's website for public access. These records are updated every month to make it easier to look up and stay updated with information on liens in the state without visiting the county's courthouse office in person.
To check for tax-related liens, visit the Pennsylvania Department of Revenue, where records of tax lienees are uploaded and updated periodically.
Free Lien Search in Pennsylvania
Interested persons may search for liens in Pennsylvania for free. Requestors don't need to pay a dime to confirm your lien status or the lien status of a property you want to buy. They may conduct a free online search by visiting the relevant official websites or visit the county's courthouse and make in-person queries.
What is a Property Lien in Pennsylvania?
A Pennsylvania property lien is a legitimate claim on collateral properties. A property lien allows the lienholder to seize the debtor's properties to recover loans when there is a payment default. Property liens can be voluntary — when the lessee agrees to put up the property as collateral in case of a default. However, they can also be involuntary — when the lien is attached because of a payment default. Examples of property liens include mortgage, tax, mechanics, judgment, and UCC liens.
How Do You Know if a Property Has a Lien in Pennsylvania?
When selling or buying a property, liens can constitute a significant hitch. No one wants to buy a property under dispute or one already serving as collateral to a debt. Hence, before buying any property in Pennsylvania, prospective buyers must carry out an inquiry to ensure there's no lien on the property of interest.
In Pennsylvania, liens are public record, and an inquiry about the lien status of a property can be made by visiting the recorder of deed in the county where the property is situated.
Details of properties in the state with lien are uploaded online for public consumption on what is called the "lien list." The lien list has the information of all the individuals, businesses, and properties filed with a lien. It also provides a monthly update on the information so that simply searching for the property's address would reveal if there's a lien on it or not.
Property Lien Search by Address in Pennsylvania
In Pennsylvania, property lien records are maintained in the recorder of deeds offices (the land records offices) and county prothonotary offices. Thus, inquirers looking to find liens on property can visit these offices in the county where the property is located. Many of these county offices also provide online search tools to check for liens on a property. Although, a person cannot conduct a lien search by address in such offices. Searches are typically performed with a property owner's name. Note that the only type of liens the recorder of deeds offices provide information on are mortgages.
Alternatively, individuals may use certain independent search sites or companies that provide a property lien search by address to find liens on property in Pennsylvania—but a fee or subscription may be required.
Free Property Lien Search by Address
A free property lien search in Pennsylvania can be performed at the office of the recorder of deeds where a property is situated or a county prothonotary's office. Following the state's Right to Know law, inquirers are not charged a fee to inspect property liens in person or via an online system. The fee requirement applies when a person wants to obtain copies of documents. Note again that these offices do not process requests for a free property lien search by address, as their records are usually organized by name or a unique number (e.g., a document or case number).
What is a Tax Lien in Pennsylvania?
A Pennsylvania tax lien is a charge on an individual or company's real or personal assets when the party defaults in paying taxes. The Department of Revenue records a lien with the county Prothonotary's Office when this happens. A tax lien automatically becomes a public record once filed, and the Commonwealth of Pennsylvania is listed as the first creditor that must be settled before any other financial obligation. In Pennsylvania, tax liens are filed for all types of state taxes, including personal income tax, company tax, employer withholding tax, and motor fuel taxes.
Tax Lien Lookup in Pennsylvania
The Department of Revenue imposes liens for unpaid taxes in Pennsylvania (including corporation taxes, sales taxes, employer withholding taxes, personal income taxes, inheritance taxes, realty transfer taxes, etc.). When a taxpayer has unpaid taxes, the department files a lien with the prothonotary office in the county where the taxpayer resides or works. The department also notifies the individual of the lien filed against them by mailing them a certified copy of the lien letter.
Persons seeking state tax liens may contact the prothonotary office at their respective counties or access the MyPath portal offered by the government of Pennsylvania. Federal tax liens can also be searched at the prothonotary office where a property lies.
What is a Mortgage Lien in Pennsylvania?
A mortgage lien in Pennsylvania allows a lending institution to claim an individual's home when a payment default occurs. It is a voluntary lien because the lender agrees to the lien before securing a loan. This agreement serves as security to the lender. A significant disparity between a mortgage lien and a property lien is that a mortgage lien is specific, as the home is used as collateral. However, property liens are general, and all assets are liable to be seized and used to recover debts.
What is a Mechanics Lien in Pennsylvania?
The Pennsylvania mechanics' lien law was enacted to ensure workers, contractors, subcontractors, and suppliers are paid for services rendered in construction projects. The PA lien law offers the improved property collateral to unpaid artisans if the owner cannot pay for the improvements.
In Pennsylvania, a mechanics' lien is listed on the record of improved properties after being filed with a local protonotary. This makes it impossible for the debtor to sell or transfer the asset to a third party. One major difference between a mechanics' lien and a property lien is that the former is a specific lien because only the improved real estate can be used as collateral. Meanwhile, the latter is a general lien as any asset can be used as collateral. The following are the requirements to file a mechanics' lien in Pennsylvania:
- Notice of intention to file a lien: This notice allows the property owner to quickly resolve all issues concerning the payment of site workers without being forced by a lien.
- Notice of furnishing: This lets the project owner know that materials will be supplied for use on the building site. This is a new requirement. Projects worth over $1.5 million should be registered with the Pennsylvania State Construction Notices Directory.
- Notice of non-payment: This alerts the owner that the laborer or supplier is yet to be paid.
What is a UCC Lien?
The Uniform Commercial Code (UCC) refers to regulations used in America to direct trading activities. The UCC requires only the exchange of commodities, shares, etc. UCC liens are petitions against an individual's business estate. It allows a lender to claim the borrower's business property due to non-payment of debts. A UCC filing allows the lender to reclaim what is owed in cases where an organization fails. In Pennsylvania, a UCC form costs roughly $84 for the financing statement, the correction statement, and the financing statement amendment. For an individual debtor, the lien is filed in the county. It is filed with the Pennsylvania Department of State when it involves an organization.
How to Conduct a UCC Lien Search
Individuals can search Uniform Commercial Code (UCC) liens filed in Pennsylvania on the Department of State's website. The agency provides a non-certified UCC Name Search and a certified UCC search to requesters. Both searches may be conducted using the lien's filing number, debtor or secured party's name, and filing date. The name search is free. However, to obtain certified copies of UCC lien records, inquirers must pay certain fees, such as a certification fee of $28.
What is a Judgment Lien?
A judgment lien is a legal action that allows creditors to claim ownership of a debtor's asset following a contract default. Most judgment liens are non-consensual liens resulting from civil litigation, where a defendant is found liable for failing to obey contractual terms. Judgment liens in Pennsylvania can only be attached to real estate. To attach a lien, the creditor has to record the judgment with the Court of Common Pleas clerk in the county where the debtor owns a real estate or might own one in the future. Judgment liens are valid for five years but can be revived every five years. A judgment can also act as a lien against an asset for up to 20 years or more.
What is a Federal Tax Lien
A federal tax lien is a lien imposed by the federal government to secure payment of taxes. When a taxpayer neglects or fails to pay their federal taxes, the Internal Revenue Service has the legal backing of the federal law (26 U.S. Code § 6321) to place a lien on the person's real or personal property. The lien ensures that tax debts to the federal government are listed as a priority and must be paid before other financial transactions can take place (for example, the sale of property, transfer of ownership, etc.).
What is a Lien Title?
A lien title indicates a lienholder's right to a property (usually a car) owned by an individual or entity. It gives the lienholder the legal right to claim the property if the debtor fails to clear their debt.
Where and How to Do a Title Search in Pennsylvania
Persons interested in carrying out a title search in Pennsylvania should visit county offices responsible for maintaining records related to property, including the recorder of deeds offices, county assessment offices, and prothonotary offices. Information accessible during a title search includes land records, tax liens, construction liens, judgments, deeds, unpaid property taxes, etc. This allows the researcher to determine who legally owns a property and whether any claims exist against it.
Additionally, title companies and real estate attorneys provide title search services. Interested persons can hire these parties to conduct the title search in Pennsylvania.
Voluntary Lien vs. Involuntary Lien in Pennsylvania?
A voluntary lien arises when a property owner (the debtor) knowingly gives another party (the creditor) a legal claim to the property as security for a loan or debt payment. The claimant voluntarily grants the lien to the creditor, and the estate functions as the collateral. An example is a mortgage lien. On the other hand, involuntary liens are imposed on a property without the permission of the owner. An example is the federal tax lien, where the Internal Revenue Service (IRS) assesses a lien because of tax payment defaults.
How Do I Get a Lien Removed in Pennsylvania?
The most effective way to get a legitimate lien removed in Pennsylvania is to pay off the debt in due time. However, a lien can also be challenged in court and, if found invalid or illegitimate, will be discharged by the court.
A lien is a legal right a person or an institution has to lay claim over a property, pending when a debtor or lienee would satisfy their obligation. However, most liens have a statute of limitations, and some creditors may decide to accept a lesser sum or completely write off the lien for free, but this is strictly a personal decision.
How Long Does a Lien Stay on Your Property in Pennsylvania?
A lien in Pennsylvania can stay on your property for up to five years and remains valid until the debt is cleared or the duration expires. Even a change of ownership cannot write off a lien on a property.
The duration of a voluntary lien on your property is dependent on the agreement one has with the lienor. Still, the law stipulates the duration of an involuntary lien on the property. For example, in Pennsylvania, a judgment lien stays on the property for five years and may last up to twenty years if renewed by the creditor.
How to Avoid a Lien in Pennsylvania
In Pennsylvania, lien avoidance can either be partial or total. Lien avoidance is partial when only the amount of the lien is reduced, and the lienee is still required to pay off the balance to avoid foreclosure. On the other hand, total lien avoidance leads to the complete elimination of the lien, restoring full ownership of the property to the debtor.