How to Resolve VA Liens

By Shauna Zamarripa

A lien, by definition, is a last-ditch effort from a creditor to collect on a bad debt by placing an ownership interest on property with the assistance of a court order. Liens appear for a variety of reasons, but all can hinder the successful sale of a home. For owners with VA (Veteran's Administration) home loans in negotiations for sale of property, resolving the loan is a straightforward process. In these cases, you can contact an experienced escrow officer before receiving a contract or once a contract is pending to receive current information regarding liens against your property.

Contact the escrow officer assigned to your listing or the pending agreement on your home. Tell him about any liens you are aware of against the property. When he completes a title search, he will email you a listing of all liens existing on the property for your acceptance or denial.

Reply back to the escrow officer's email, informing him which liens on the premises are valid and which are not (to the best of your knowledge). He will have you sign an affidavit before closing, affirming or denying all filed liens.

At the closing of the property, sign off on the final payment of any lien belonging to you. These amounts will be automatically deducted from the seller proceeds on the property. However, once the liens are paid out of the proceeds, they are cleared from the property and title transfers, resulting in a successful sale. After the property closes, the lien and any court judgment is marked paid on your credit report, no longer an obstacle or negative mark.

For any lien on the property that is not yours in a title search, the affidavit will deny payment of the lien and authorize the title to transfer successfully, providing the escrow officer gives the affidavit to the lien holder. If he does not, you may be responsible for paying the lien.

Do not falsify information regarding liens. Falsification of any legal real estate documents come with serious consequences.

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