When a person is not able to pay the tax on his property or doesn’t make the mortgage payments on time, the mortgage company or bank or the taxation department has the legal right to take the property away from the owner and sell it to someone else who can buy it and will pay for the taxes or will make mortgage payments. In order to transfer the ownership of the property to the new owner, a legal agreement or transfer deed is signed which is known as the lien certificate.
Introduction to the Claim of Lien Certificate:
When a person i.e. bidder or a contractor buys lien property with help of mortgage company or taxation department, before making any changes to the property or before claiming his ownership rights on the property, the buyer has to possess the lien certificate. This certificate indicates that the new buyer has won the bid or auction and he is now the legal owner of the property and can do whatever he wants with the property i.e. sell, rent or remodel etc. Before doing so, the buyer has to ask for the Claim of Lien Certificate as it can take some time for the taxation department or the mortgage company to process the documents and paperwork for the transfer and issuance of the lien certificate. Claim of the lien certificate is the formal process of applying for the issuance of the lien certificate and the individual has to make this formal request with proper documents.
Brief description of Claim of Lien Certificate:
When a bank or mortgage company finds out that a loaner can’t pay his mortgage payments for his house or other piece of property or when the taxation department finds that a certain individual is not paying his taxes, they have the legal right to seize the property and sell it to someone who is willing to buy it and will take care of the outstanding expenses and charges i.e. taxes and mortgage payments. Usually this type of property is sold to new buyers through auction or bidding process. Once a person wins the bid or auction, he is given the ownership of the property and asked to pay for the taxes and outstanding mortgage payments. In order to do so, the new buyer has to have a proof of his ownership of the property. The claim of the lien certificate is the process of formally requesting to issue the transfer deed of the ownership of the property sold to the new owner.
Key elements to include in the Lien Certificate:
- Name of the person who is the actual owner of the property
- Name of the person who is claiming the lien property
- Date when the property was taken
- Details of authority or department who is taking the property (i.e. tax department or mortgage company)
- Reasons for the lien of the property (i.e. tax payments or mortgage loan payments)
- Transfer deed of the property for the ownership
- Terms and conditions of the lien certificate
- Validation and expiration of the lien certificate
- Signature of the authorized person
Here is preview of a Free Sample Claim of Lien Certificate created as fill-able PDF Form,
Here is download link for this Claim of Lien Certificate,