When someone buys a commercial property, they are expected to make monthly mortgage payments to the bank until they fully own the property. Should the debtor (buyer) fall behind or fail to make payments, the bank may seek to put a lien on their assets.
To ensure the collection of a monetary judgment, a judgment lien may be imposed on the property of a debtor. This grants the creditor the right to receive a specific amount of money from the proceeds of the debtor’s property sale. This means that the bank has a legal claim over the assets until the debt is repaid. If the debtor fails to repay the loan, the creditor can sell the property to recover the lost revenue. The creditor will need to apply for the lien in court.
Can a judgment lien be contested?
Debtors need to keep in mind that over time, interest accrues on a judgment lien, which increases the debt. They do have a right to ask the court to remove the lien if they can’t pay. Should the creditor agree, they may choose to accept a financial settlement offer from the debtor based on their company’s policies. This allows the creditor to recoup some of their losses.
If the debtor believes the lien is incorrect, they may contest it. However, if the creditor disagrees that the lien should be lifted, they may have to sue the debtor.
When a debtor purchases a property that is tied to a prior order, they may request that the creditor remove the lien.
If you’re having difficulty making your payments on a commercial property, it’s best to seek assistance from someone who understands your legal rights. This can make the process of getting back on track easier and faster compared to doing it alone.