What is a privilege? Information for owners


Privilege FAQs

Now that you know the basics, let’s answer some frequently asked privilege questions.

What does it mean to have a lien against you?

When you have a lien against you, it means that someone has an interest in your property under specific circumstances. Typically, this would involve defaulting on an agreement or loan. The government will also place a lien on your property over unpaid taxes.

Privileges don’t have to be a bad thing. Sometimes that just means you haven’t finished paying off a debt. Anyone who has a mortgage has a lien on their home. They are also common if you have a solar panel loan.

How do I remove a lien from my property?

More often than not, you get a lien waived by paying off your debts in full, paying for work under an agreement, satisfying a judgment, or paying back taxes. If you believe that a lien has been wrongly placed, there are certain circumstances in which you may need to go to court to have it removed.

Will a lien affect my credit rating?

If you have a lien, it is possible that it has an impact on your credit score as it can show up on your report as a negative item, especially if you have something like an unpaid judgment. It’s common to have a lien on your home or car if it’s a car loan, but if you have things like judgments, mechanic’s liens, or tax arrears to settle, this is might present a greater challenge to qualify.

Can I refinance my home if there is a federal tax lien on it?

Generally, tax liens must be paid before you close your home. The only exception is that the FHA allows you to close with a tax lien under certain circumstances if you are on a repayment plan and have made at least 3 months of documented payments. We recommend that you discuss your situation with a mortgage expert.


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