Payoff
First of all, it is necessary to understand that a lien may be removed from property simply by paying off what is owed. If only life were that simple. Typically, the only reason that the lien exists is because the debtor did not have the money to make payment satisfactorily. Bottom line – no money to make a payment means no money to satisfy the lien.
But if you are fortunate enough to be able to pay off a lien in full the next step is to file a Release of Lien Form. A Release of Lien form will be filed according to the statutorily defined requirements, which in turn depend upon the type of lien in question. Once filed the lien is essentially removed from the property of the debtor.
Negotiate with the Creditor
Negotiation with a creditor is to me a preferred option when the ability to pay off the lien in full is not available. Depending upon a number of factors a debtor may be able to choose arbitration, mediation, or even a less formal form of negotiation with a creditor (often, by enlisting the services of an attorney). Providing an open assessment of your financial situation (present, past and future) may be all that is necessary to assist a creditor in understanding that working to reduce the total amount owed will result in a more beneficial result to the creditor than pursuing the option of a lien.
File for Chapter 7 Bankruptcy
When other options fail, or when other circumstances add up to making bankruptcy the best option for an individual or business, filing for Chapter 7 may be necessary. When filing for bankruptcy under Chapter 7, the debtor may be able to have certain liens removed. The possibilities of removing a lien by filing for bankruptcy varies according to the type of lien and the amount of time that has passed, consulting with a bankruptcy attorney is a prudent choice.
Proceed through the Court
If you have been the victim of bad faith, fraudulent activity, or were coerced by a creditor, it is possible that a judge might agree with evidence presented in court of this bad behavior and release you from the lien.
Wait out the Statute of Limitations
A lien may be unenforceable if the creditor does not follow the statutorily defined requirements as to filing a suit once default on payment has occurred; known as the statute of limitations, or simply, the amount of time the aggrieved party has to act within the court system. Failing to act within the specified time-limit may result in an unenforceable lien.
For more information read “What is a property lien in Massachusetts?“
DISCLAIMER:
The information provided in the pages and posts of this website are for general informational purposes only. The information presented on this site is not legal advice, and no attorney-client relationship is formed by the use of this site.