There’s A Lien On My Knoxville Property. Should I Be Worried? [Knoxville Title Company FAQ]

Feb 12, 2020 | Buying A Home, Closing Process

After a Knoxville title company receives a contract for a closing, the first thing that is done is to order a title examination.

A title examination is a critical part of the closing process because it confirms whether or not clear title can be conveyed on a property. When a title examination is done, an abstractor looks back at 30 years or more of public records. A title examination will reveal many things about a property including past deeds, liens, judgments, and anything else of public record.

There are many times where a title examination will reveal an unexpected lien against a property. Sometimes it’s a mortgage against a previous seller or a judgment against someone with a similar name. When this happens, the seller can quickly go into a tailspin (and rightfully so), if they don’t fully understand the situation.

In this post, we’ll cover what happens when an unexpected lien is found in a title search, how it is resolved, and what you can to do ensure closing happens on time.

Why Do Unexpected Liens Matter?

A title examination is done to confirm an owner can convey clear title. Any issues that are found on a title examination must be resolved prior to closing.

When an unexpected lien is found against your property, the issue needs to be cleared up prior to closing. Depending on the type of lien, there are a few different ways that the issue can be resolved:

  • If it’s a valid lien against the seller, it can be paid at closing.
  • The title company can obtain a $0 balance if the lien has been paid in full.
  • Or, the title company can obtain a release showing that the lien has been paid in full.

If you do hear there is an unexpected lien against your property, don’t panic. You should know a majority of these liens can be cleared up quite easily.

What Kind Of Unexpected Liens Can Be Found Against A Property?

There are a handful of liens that commonly pop up on a title search. Here we’ll explain what kinds of liens those typically are and how they are resolved.

Judgment Liens

Judgment liens are one of the most common things that pop up on a title examination. A judgment is filed when someone sues you and wins the lawsuit against you. This can be done for when you don’t pay a medical bill or don’t pay off your credit card.

When a title search is done, a judgment search is also done. When a judgment is found on a title search, a title company will either need to get a payoff on it or prove that the judgement isn’t the same person as the seller.

How this issue is resolved: There are many times when a judgment isn’t actually the same person as the seller, it’s just someone with a similiar name. When a seller has a common name, it’s not unncommon to find a another person with similiar name who has a judgment against them. When that is the case, Knoxville title company will just need to confirm the judgment isn’t you. Usually, they will just need the last 4 of your social so that they can contact the creditor and confirm you’re not the same person. Most likely, you’ll also have to sign an affidavit at closing.

If the judgment is against you, you’ll just need to get a written payoff statement from the creditor. Keep in mind, when you have a judgment against you, it attaches to all properties that you own.

Mortgage From A Previous Owner

Mortgages are paid off at closing. There are times when a mortgage is paid off at closing, but not properly released. When this happens, a mortgage from a previous owner will show up on a title search.

For sellers, it can be scary to think that there is a lien out there from a previous owner that could hinder your ability to sell your home. But, rest assured this happens more frequently than many people realize.

How this issue is resolved: Oftentimes, the simplest way to resolve this issue is by providing your Knoxville title company with a copy of your owner’s title policy. The previous title company will indemnify over any liens that remain on the property prior to you owning it.

Another avenue is by contacting the title company that closed the property. That title company can provide proof that the mortgage was paid off at closing.

The final option that can be done is to get a release. In cases, where proof of payoff was found or an owner’s policy was used, a release will still be pursued so the issue is cleared up. Some releases are more difficult to get than others, depending on the mortgage company. Things get harder when the mortgage is older and the mortgage company has gone out of business.

Mortgages You’ve Paid Off

Finally, another unexpected lien that may appear on the title search is a mortgage that you previously paid off. When you’ve owned a property for a long time, you may have refinanced or taken out a home equity line of credit. Sometimes, when these mortgages get paid off but the release isn’t recorded.

This circumstance happens more than any sellers may realize, which is why it can be important to keep any paperwork pertaining to those properties. Home equity lines of credit are the type of loan that this happens most commonly with. Since these are open-ended mortgages, they are not automatically closed when they’re paid off.

How this issue is resolved: This is a fairly simple issue to be resolved. It’s generally easiest to get something from the mortgage lender confirming that the loan has been paid off, then request that the lien be released. It only gets complicated when a mortgage company has gone out of business or changed names.

What Can You Do To Help The Process?

The biggest thing any seller can do to help resolve an unxpected lien issue is to cooperate. In many cases, your Knoxville title company can help clear up the issue, with some help from you. Oftentimes, the more information that you’re able to provide, the better.

Are you looking for a Knoxville title company?  Look no further than Title Group of Tennessee! We are dedicated to providing timely, efficient, and accurate closing services to our clients. Please do not hesitate to contact us about the services that we offer or with any questions you may have regarding the closing process.  Give us a call at 865-392-5801, or send an email to

We welcome the opportunity to work with you and are happy to assist you in any way that we can.