Selling a Las Vegas Home with a Lien on the Property

by Ryan Rose

A lien is a legal claim against your property, usually for money owed. Liens must be resolved before you can transfer clear title to a buyer. If you are selling a Las Vegas home with a lien, understanding your options and the process helps you navigate the transaction successfully.

Common Types of Liens

Several types of liens can attach to residential property:

Lien Type	What It Is
Mortgage lien	Your home loan, paid off at closing
Tax lien	Unpaid property taxes or IRS debt
Mechanic's lien	Unpaid contractor or supplier bills
HOA lien	Unpaid homeowner association dues
Judgment lien	Court judgment for money owed
Child support lien	Unpaid child support obligations

How Liens Affect Your Sale

Liens create clouds on title. Buyers expect clear title, meaning no claims against the property other than what they are aware of and accepting. Title companies will not close transactions with unresolved liens.

This does not mean you cannot sell. It means liens must be addressed as part of the sale process, either paid off from proceeds, negotiated with lien holders, or resolved before closing.

The Title Search

When you sell, the title company conducts a title search to identify all liens and encumbrances. This happens early in the process, giving time to address issues before closing.

Sometimes sellers are surprised by liens they forgot about or did not know existed. A contractor who was not fully paid years ago may have filed a mechanic's lien. An old judgment may still be attached. The title search reveals these.

Resolving Liens at Closing

Most liens are resolved at closing using sale proceeds:

Your mortgage. This is a lien, and it gets paid from proceeds automatically. The title company handles the payoff.

Property tax liens. Unpaid property taxes are paid from proceeds at closing.

HOA liens. Outstanding dues and assessments are paid at closing.

Judgment and other liens. These are typically paid from proceeds, with the title company disbursing funds to lien holders.

When Liens Exceed Equity

Problems arise when total liens exceed your equity. If you owe more than the home is worth (including all liens), you cannot pay everyone from the sale proceeds.

Options in this situation include:

Bring cash to closing. You pay the difference out of pocket.

Negotiate with lien holders. Some creditors will accept less than the full amount to release their lien, especially if the alternative is getting nothing.

Short sale. With lender approval, you sell for less than owed. This affects your credit and requires lender cooperation.

Mechanic's Liens

Mechanic's liens deserve special attention. Contractors and suppliers who are not paid can file liens against your property. These can be filed by subcontractors even if you paid your general contractor but the general contractor failed to pay their subs.

If you have had recent work done, make sure all contractors and suppliers have been paid and consider getting lien releases before selling.

IRS Tax Liens

Federal tax liens are particularly sticky. The IRS has strong rights, and these liens must be satisfied or released before closing. If you have an IRS lien, contact the IRS early in the selling process to understand payoff requirements and timing.

Judgment Liens

If someone sued you and won a money judgment, they may have recorded it as a lien against your property. These judgments can be years old but still valid. The title search will reveal them, and they must be paid or negotiated before closing.

Proactive Steps

If you know you have liens:

Get payoff amounts. Contact lien holders for exact payoff figures.

Disclose to your agent. Your agent needs to know about liens to price correctly and manage expectations.

Calculate your net. Make sure you understand what you will actually receive after all liens are paid.

Address issues early. The more time to resolve complications, the better.

Where to Start

If you are selling a Las Vegas home and believe there may be liens, let us discuss your situation. Understanding the full picture helps you plan realistically and avoid closing delays.

Ready to explore your options? Request a free home evaluation here or reach out directly to discuss your situation.

Frequently Asked Questions About Selling a Las Vegas Home with a Lien

Q1: Can I sell my Las Vegas home if there's a lien on it?

Yes, you can sell a home with a lien on it. However, the lien must be resolved before closing to transfer clear title to the buyer. Most liens are paid off using the proceeds from the sale. The title company will identify all liens during the title search and coordinate payoffs at closing.

Q2: What happens if my liens are more than my home's value?

If your total liens exceed your home equity, you have several options: bring cash to closing to cover the difference, negotiate with lien holders to accept reduced payoffs, or pursue a short sale with lender approval. A short sale will impact your credit and requires your mortgage lender's cooperation.

Q3: How do I find out what liens are on my property?

The title company performs a comprehensive title search early in the selling process that will reveal all recorded liens and encumbrances on your property. You can also check Clark County records or request a title report before listing your home to understand any potential issues upfront.

Q4: Do I have to pay off HOA liens before closing?

Yes, HOA liens for unpaid dues and assessments must be paid before closing. These are typically paid from your sale proceeds at closing, and the title company will handle the disbursement to the homeowner association directly.

Q5: What is a mechanic's lien and how does it affect my sale?

A mechanic's lien is filed by contractors, subcontractors, or suppliers who haven't been paid for work or materials provided for your property. These liens must be resolved before closing. Even if you paid your general contractor, a subcontractor who wasn't paid by that contractor can file a lien against your property. Always obtain lien releases after construction work is completed.

Q6: How long does it take to resolve a lien?

The timeline varies depending on the lien type. Simple liens paid from closing proceeds are resolved at closing. IRS tax liens may require advance coordination with the IRS and can take several weeks. Disputed mechanic's liens or judgment liens may require negotiation or legal action, potentially taking months. Starting the resolution process early is essential.

Q7: Can a buyer back out if they discover liens on my property?

Buyers expect clear title at closing. If liens are discovered during the title search and cannot be resolved, buyers may have grounds to cancel the contract. However, if you can demonstrate that liens will be paid from sale proceeds and resolved at closing, most transactions proceed normally. Disclosing known liens upfront prevents surprises.

Q8: What happens to my mortgage lien when I sell?

Your mortgage is a lien that gets paid off automatically at closing using your sale proceeds. The title company obtains a payoff amount from your lender, pays it at closing, and ensures the lien is released from your property. This is standard procedure for every home sale.

Q9: Can I negotiate with lien holders to reduce what I owe?

Yes, some lien holders may negotiate, especially if the alternative is receiving nothing. Judgment creditors, contractors, and even some tax authorities may accept reduced settlements. However, mortgage lenders typically require full payment, and negotiations should be handled carefully, preferably with legal or professional guidance.

Q10: Should I disclose liens to potential buyers?

You should disclose known liens to your real estate agent so they can properly calculate your net proceeds and set accurate expectations. While the title search will reveal all recorded liens anyway, being upfront prevents delays and shows good faith. Your agent can help position the sale correctly and ensure liens are factored into the transaction timeline.

Q11: What if I discover a lien I didn't know about during the sale?

Unexpected liens discovered during title search are common—old contractor bills, forgotten judgments, or unknown tax issues. Don't panic. Work with your title company and agent to verify the lien's validity, obtain payoff information, and determine if it can be paid from proceeds. Most surprise liens can be resolved before closing with proper coordination.

Q12: How do IRS tax liens affect selling my Las Vegas home?

IRS tax liens are powerful and must be satisfied or officially released before closing. Contact the IRS early in your selling process to get exact payoff amounts and understand release procedures. The IRS may allow payment from sale proceeds or negotiate a settlement. These liens require extra time to resolve, so plan accordingly.