Can someone file a lien against me and my property without my knowledge?

Yes. There are different types of liens that may be filed against property that you own and some of them don’t require your signature. Of course, the most obvious lien is a Deed of Trust that is recorded when you take out a loan using your property as collateral. A Deed of Trust would require your signature, but there are scammers out there who will forge signatures and file fraudulent Deeds and Deeds of Trust against property in order to attempt to steal the property from the rightful owner.

The types of liens that do not require your signature include Mechanics and Materialmans Liens (“M&M Liens) judgment liens and tax liens. M&M Liens are liens that any worker who does work on your property can record to help ensure they are paid for the work. They have a one year statute of limitations in Tennessee to file a lawsuit in order to enforce that lien and if they do not file the lawsuit within one year, the lien will lapse and will no longer be effective. However, if you are trying to sell the property or take out a loan against the property within that one year period, it is likely the lien would need to be paid off. Judgments are issued by a judge when someone sues you and wins the lawsuit against you. Those judgments can be recorded in the Register’s Office and will attach to any property you own in that county. Most of the time, if you are sued and served process, you show up in court and are aware that there is a judgment against you. But if you do not show up in court and the plaintiff gets a default judgment against you, you may not remember the judgment and may not realize that it can attach to your property. In Tennessee, judgment liens have a ten year statute of limitations from the date the judgment is entered. Tax liens are when a homeowner doesn’t pay property tax, state tax or federal income tax. Those liens can be recorded without your signature and the property tax liens will attach to the property on which the taxes are delinquent and will eventually lead to a tax sale if not paid. State and Federal Income tax liens can attach to any property that you own, similar to a judgment lien.

How can I find out when someone files a lien or fraudulent deed against my property?

If your property is in Davidson County, the Davidson County Register’s Office has started an alert system that will inform you anytime anyone files a lien or a deed in your name. The Register has said that seniors, immigrants and people with multiple or vacant properties are especially at risk for this type of fraudulent activity. There are situations where a lien, such as a tax lien, is legitimate but the homeowner simple forgot to pay the bill. This system will alert them so they can make sure it is paid before they lose the property. To sign up for the free service, you must go to the Davidson County Register’s website and register your name and an email address to send notifications. The website is http://www.davidsoncorecords.com.

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Know What The Contract Says

It is very important to pay close attention to the details in a contract. Most residential real estate contracts contain form language with some sections that are “fill in the blank”. Those sections are all very important details of the specific transaction. Some obvious items you want to check are:

  • Purchase price
  • Amount of Earnest Money or Trust Money
  • Closing Date
  • Inspection Period
  • Which costs are to be paid by the buyer and which costs are to be paid by the seller
  • Home Warranty

However, you should also pay close attention to what your buyer is contracting to purchase or your seller is contracting to sell. Here are a couple of situations I have seen that could have been resolved easily if it was more clear before the contract was executed:

  1. I recently had a contract where the buyer’s agent prepared the contract with the street address of the property, referenced the map & parcel number for the property and referenced the prior deed, where the seller acquired the property. That seems like a situation where it is pretty clear which property is being sold. However, the seller had recently subdivided the property so he could sell the part of the property with the house on it and build another house on the other part of the property. The two new parcels were also assigned new parcel numbers. All of that was done at about the same time the contract was signed, so there was no way for the buyer’s agent to know that the property had been subdivided. If you were to look at the only the contract, it would appear that the buyer was purchasing 123 Main Street, but it was the seller’s intention to sell Unit A on the 123 Main Street Subdivision. This grew into a dispute that has become costly for both sides, but could have been easily resolved if the seller or seller’s agent had noticed that the entire property (123 Main Street) was listed on the contract instead of just one of the units, before signing the contract. That way, the buyer would have known what the seller intended to sell and could have adjusted the offer price accordingly.
  2. In another similar situation, I once closed on a foreclosure property where the seller was selling 356 Oak Ave, which was the property that had been foreclosed on. The buyer closed on the property and thought they were getting a house and a vacant lot that was surrounded by a fence attached to the house, but after closing, realized that the property at 356 Oak Ave. was separate from the fenced vacant lot at 358 Oak Ave. The original owner of both 356 and 358 had a loan only on 356 Oak Ave. That meant that the lender could only foreclose on 356 Oak Ave, because it had no interest in 358 Oak Ave. The original owner still owned 358 Oak Ave. and didn’t even realize it because he thought it had been foreclosed on during the house foreclosure. A little more research by the buyer or his agent (and clarification in the contract) would have made the buyer aware of what the seller was able to sell, so he could decide if that was what he wanted to purchase.