A lien is the public notice of a debt against a person or a thing. Most liens are recorded on a first-come, first-serve basis. The order in which liens are filed is called “lien priority”. A lender in first lien position has no barrier to foreclosure. A debt in second or third lien position and can only foreclose by paying off the liens ahead of it.

Your preliminary title report will itemize all liens recorded against the home you are buying and all parties involved in the transaction. Expect to see liens for the seller’s mortgage(s) and property taxes. Other possible liens: attorney’s fees, divorce settlements or liens for work performed on the property. The IRS can lien an individual for unpaid taxes.

All existing liens must be released for your purchase to close, so that your new loan will be in first lien position.