Lien Sale

DEFINITION of 'Lien Sale'

The sale of the claim or "hold" placed on an asset to satisfy an unpaid debt. Typically, lien sales are conducted as public auctions and the lien is on real estate, automobiles and other personal property. Depending on a particular state's laws, contractors, subcontractors and suppliers may put a lien on a piece of property they have worked on pending payment for services rendered.

BREAKING DOWN 'Lien Sale'

Buying delinquent tax-liens at a sale is becoming an increasingly popular form of investing, and is similar to purchasing a long-term Certificate of Deposit (CD). However unlike a CD, tax-liens cannot be sold back to the taxing authority and must be held until they are repaid. Redemption of the purchased lien is typically at a given rate of return within a specified time frame.

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RELATED FAQS
  1. How can I invest in tax liens?

    Find out about the steps an investor must take to invest in tax liens, along with the potential benefits of doing so. Read Answer >>
  2. How do I avoid a tax lien on my property?

    Find out the best way to prevent the government from placing a lien on your property, including the consequences of having ... Read Answer >>
  3. What types of liens are seen as good and which are bad for my credit?

    Understand what a lien is and what types of liens are most common for individuals, and learn which types of liens are good ... Read Answer >>
  4. What is the difference between a lien and an encumbrance?

    Understand the legal terms ''lien'' and ''encumbrance,'' and learn the significant distinction between these two essential ... Read Answer >>
  5. Does the IRS report to credit bureaus?

    Understand the relationship between the IRS and the various major credit bureaus. Learn how credit bureaus find out about ... Read Answer >>
  6. What is the difference between a possessory and a non-possessory lien?

    Gain a basic understanding of a possessory lien and a non-possessory lien, the key differences between the two structures ... Read Answer >>
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