Voluntary Lien

DEFINITION of 'Voluntary Lien'

A claim that one person has over the property of another as security for the payment of a debt. Liens are attached to the property and not to a person. A voluntary lien is contractual or consensual, meaning that the lien is created by an action taken by the debtor, such as a mortgage loan to buy real estate.

BREAKING DOWN 'Voluntary Lien'

A voluntary lien is a type of lien that exists because of an action taken by a debtor. This is the opposite of an involuntary lien that occurs by law, such as a tax or special assessment lien that is imposed by a regulatory authority.

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RELATED FAQS
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    Find out about the steps an investor must take to invest in tax liens, along with the potential benefits of doing so. Read Answer >>
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    Find out the best way to prevent the government from placing a lien on your property, including the consequences of having ... Read Answer >>
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