Statutory Liens

 

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There are many different types of liens that creditors can use to get at your assets to satisfy a debt. In certain circumstances, creditors obtain security interests by the operation of state (or federal) laws. These liens include:

• Mechanic's Liens. This type of lien arises when a contractor or mechanic performs work on property and is not paid. Examples include a contractor who installs a furnace in a home, or an auto mechanic who performs repairs to a car. This lien is a security interest in the property. If the owner tries to sell the property, the debtor will have a secured interest in the portion of the proceeds needed to pay the debt.
• Tax Liens. This type of lien is placed against property by the local, state or federal government, as authorized by statute, for delinquent taxes, including property, income and estate taxes.

The other common types of liens include consensual liens and judgment liens.