What is a lien?

A lien is a legal claim against a property, which serves as security for a debt or obligation. This means that the lienholder has the right to take possession of the property or force its sale if the debt is not paid. Liens can arise from various situations, such as unpaid taxes, loans taken out against the property, or legal judgments. They are critical in real estate transactions because they can affect the transfer of property ownership and the seller's ability to sell the property without first clearing outstanding debts.

Other options, while related to real estate in some capacity, do not accurately define what a lien is. A type of mortgage agreement refers specifically to a loan secured by real estate, which is different from the broader legal claim concept. An insurance policy for property owners relates to coverage for damages or losses and does not represent a claim against the property. Similarly, a rental agreement pertains to the terms under which property is leased, and does not involve any legal claim to ownership or debt.