A lien is a special right in a debtor’s property that the law gives to a creditor in order to assure payment of a debt. Liens may arise in a variety of ways.

  • Judgment liens are obtained as a result of debt collection proceedings.
  • A debtor may give a creditor a lien on personal property in return for a loan, such as an automobile loan.
  • Government entities have liens that arise by “operation of law” for unpaid taxes.

Other Types of Liens

There are other types of liens that arise when a worker repairs or improves the property of a customer.

Mechanic’s or Materialmen’s Lien

When the work is done on real property, such as construction or repair of a structure, these liens are generally referred to as “mechanic’s liens” or “materialmen’s liens.”

Generally speaking, if state law recognizes the existence of such liens, the artisan who improves or repairs real property may retain the property until payment for the work is received. Often, state statutes contain specific provisions concerning these types of liens.

Possessory Liens

When work is performed on personal property such as an automobile, watch, or even a pair of shoes, these liens may be referred to as artisan’s liens or common law possessory liens.

Other possessory liens arise when an innkeeper is permitted to retain the personal property of guests in order to assure payment for their lodging, or when a landlord is permitted to retain tenant property to assure payment of past due rent.

A creditor who has a lien on the property of a debtor may have the right to foreclose the lien by selling the debtor’s property to satisfy the debt. The lien also may give the creditor priority over other creditors who are attempting to collect from the same debtor.