Definition
A lien is a legal claim or right against a property, typically used as security for a debt or obligation. Liens give creditors the right to take possession of the property if the debt is not paid. The most common type is a mortgage lien, where the lender has a claim on the property until the mortgage is paid off. Other types include tax liens, mechanic\'s liens, and judgment liens. Properties with liens generally cannot be sold until the liens are satisfied.
Example
Mortgage Lien Example
When you buy a home with a $250,000 mortgage, the lender places a lien on the property for that amount. This lien gives the lender the right to foreclose if you default. If you sell the home before paying off the mortgage, the lien must be paid from the sale proceeds first, with any remaining money going to you.