What is a Lien in Louisiana?
A lien is a civil claim over property or an item of a financially indebted individual. The Louisiana Lien Law provides details about who may have a lien in the State, the extent of claims, and the procedure for establishing them. When a lien is general, it covers almost the entire property of the indebted entity. Specific liens are different in that they are claims with defined restrictions to a particular property. Liens could also be voluntary. Voluntary liens require the debtor to initiate the action. Involuntary liens are usually initiatives of creditors to force payment either by compliance or to get paid through the sale of the debtor's property. Liens are created and enforced by judicial orders issued in Louisiana courts.
Types of Lien in Louisiana
Liens are security interests intangible assets, such as real estate and personal property. They entitle creditors to seize an attached or collateral asset if an underlying financial obligation is not met.
In Louisiana, liens can be consensual or statutory. Consensual liens are those people consent to, usually to obtain a loan or credit. Residential mortgage loans and car loans are examples of consensual liens.
On the other hand, statutory or involuntary liens are those filed by a creditor to collect a debt, often when taxes are not paid or loan payments are late. These liens are filed without a debtor's consent and imposed on their assets by a court or the law. Examples include:
- A mechanics lien: This lien can be filed when a contractor or mechanic works on a property without being paid.
- A tax lien: The local, state or federal government can place this lien on someone's property for unpaid taxes, i.e., property, income, and estate taxes.
- A judgment lien: This typically originates from a lawsuit.
Liens can also be general or specific. A specific lien is issued against a particular asset. In contrast, a general lien extends to all real and personal property a debtor owns.
How Do I Check for Liens in Louisiana?
Most liens, such as judgment and mechanics liens, are recorded in the Louisiana parish recorder's office in the parish where the property or asset to be encumbered is located. As a result, the parish recorder is responsible for creating and maintaining lien records. Louisiana's Public Records Law mandates that all records created, held, and maintained by state agencies are open to review and copying unless otherwise specified by law. This includes lien records.
However, each parish in the State has its own set of laws and restrictions for granting access to such records. It is crucial to get in touch with the appropriate agency office to find out how to proceed. In any case, if the person checking for liens happens to be the property owner, the individual will typically be alerted of liens on their property.
Additionally, the Louisiana Secretary of State's office keeps track of UCC (Uniform Commercial Code) liens filed. Members of the public can inspect and copy these records upon request.
Free Lien Search in Louisiana
In Louisiana, public records can be reviewed for free. Because lien records are open to the public, they can be viewed at the custodial agency's office at no charge. (Note that if requesting to duplicate lien records, there is usually a small cost for document reproduction.)
Also, most local recording offices and the Secretary of State provide searchable databases on their websites for convenience. Interested parties can conduct free lien searches using these databases. However, inquirers are still urged to visit the agency's office in person to obtain complete records.
What is a Property Lien in Louisiana?
A property lien in Louisiana is a blanket expression for liens that involves property. The property could be business or personal. A series of Louisiana laws guide the interpretation and implementation of transactions concerning property liens in the State. Simply put, a property lien involves claims of a creditor to a non-exempt property of an indebted individual pending the completion of payments.
Property liens may be voluntary. That is to say; it is with the consent of the property owner. Involuntary property liens constrain the owing party to pay up their debts. A property lien may arise because of other forms of liens. For example, a judgment lien is a court order that gives the creditor party the right to register a claim on the judgment debtor's property. It is involuntary and serves as collateral security if the borrower fails to pay. All the types of liens claim the property in one way or another as collateral security. If the debtor fails to pay, the creditor either acquired ownership of the property or forces a foreclosure to get a cash payment. The property could range from buildings and vehicles to personal articles of significant financial value, such as jewelry. A debtor may enjoy protection from property liens by seeking homestead exemption. Here, a fixed value of the property is not accessible to the creditor because it is an essential article to the debtor. For example, the indebted party's residential apartment is protected from exclusive lien claims that can cause the owner to lose the house. Instead, a fixed amount of the house's cost is acceptable to a creditor for liens. Essential articles may also mean critical equipment for day-to-day business or other items necessary to basic survival. Another way to get protection from property liens is to file for bankruptcy.
If the property falls under non-exempt property, such will be protected from creditor action. The eventual outcome of the repayment process in a bankruptcy proceeding relies heavily on which chapter the filing party opted for. Chapter 7 bankruptcy filings may predispose the indebted party to foreclosure and eventual loss of some personal property. Chapter 13 bankruptcy filings are much more restrictive regarding what is available for creditor action. Property liens are public records in Louisiana. It means that anyone can look them up at the Tax Records Office, Land Office Documents of the State. Access to them may be in person or online. Call (225) 219-9454 or send a facsimile to (225) 342-5458. Alternatively, send an email or postal mail to:
P.O. Box 44124
Baton Rouge, LA 70804
It is to guide investors and prospective buyers as to which property is available for sale without liens.
How Do You Know if a Property Has a Lien in Louisiana?
When a voluntary lien is attached in Louisiana, the property owner will be aware of the claim and its terms and conditions since it was established with their consent.
On the other hand, statutory liens are attached without the property owner's approval. As a result, the owner may not be aware of the situation until they try to sell or transfer the property. For this reason, carrying out lien searches through official sources can help discover if a property located in Louisiana has a lien.
The method used to perform a lien search depends on the type of lien and the property to which it was affixed. Generally, the court clerk or parish recorder's office is a good start.
Property Lien Search by Address in Louisiana
Generally, liens are public records. Hence, a record seeker can request a property lien search in Louisiana at the Clerk of Court office in the parish where the property is located. Most Parish Clerks of Court offices have online tools where a Louisianna resident can check liens on a property. These online tools majorly allow a name search and not an address search. A requester who wants to find liens on a property by using the property address can make an in-person request at the Clerk of Court office in the parish where the property is located. Contact the Parish Clerk of Court offices for more information on how to check for liens on a property by using its address.
Free Property Lien Search by Address
A requester might be able to check liens on a property in Louisiana for free at the Clerk of Court office in the parish where the property is located. This might be possible if someone who wants to find liens on a property only wants to view the record or obtain an uncertified copy. This is because a certified property lien record might come at a cost. Contact the Parish Clerk of Court offices for more information about a free property lien search in Louisiana.
What is a Tax Lien in Louisiana?
A tax lien is a penalty assessed by the Louisiana Department of Revenue to enforce payment by placing a lien on the debtor's property. The laws of the State impose that liens could be in the form of interests, penalties, taxes, or lawyer fees. When an indebted individual receives a lien on their property, they must submit a Louisiana Tax Assessment and Lien Payoff request through the agency to determine how much they must pay. When payment is made, the debtor's account undergoes review and cancellation. The process takes about 4 to 5 days. Defaulting taxpayers can expedite the process by sending the form by facsimile to the particular collection unit at (225) 219-2256.
Tax Lien Lookup in Louisiana
Generally, tax liens are public records maintained by agencies in charge of land records. A tax lien lookup in Louisiana can be done at the Clerk of Court office in the parish where the property is located. For instance, the Plaquemines Parish Clerk of Court has an online tool where inquirers can access tax lien records. To use the online tool, requesters must create an account, pay the necessary subscription fees, and sign in with their user IDs and passwords. Alternatively, an interested person can sign in as a guest. Here is how to conduct a tax lien lookup as a guest:
- Sign in as a Guest at the Plaquemines Parish Clerk of Court e-Search platform
- Click on the Indexed Records link
- Go to the “Index Type” search box and select “Mortgage”
- Go to the “Kind” search box and select “Tax lien”
- Then conduct a search by last/firm name, first name, middle name, title, party, or date
A tax lien search results typically reveal information like index, file date, kind, mortgagors, mortgagee, remarks, file number, book/page number, and image.
What is a Mortgage Lien in Louisiana?
A mortgage lien is a voluntary claim that an indebted individual gives to a creditor over a property to acquire it after a series of payments. The caveat is that inability to pay will lead to the return of full property ownership to the creditor. Residents in Louisiana employ this type of lien to acquire houses or vehicles by payments over time rather than an upfront payment. LA Rev Stat § 9:4821 provides legal interpretation and procedure for mortgage liens in the State.
What is a Mechanics Lien in Louisiana?
A mechanic's lien is a legal tool that gives the creditor party security in the form of a claim to the indebted party's property. A mechanic's lien is particularly applicable to construction work. The lien clouds the estate title so that the indebted party cannot sell it until the debt is paid. It is also valuable for suppliers of labor or material to secure payment. One effect of a mechanic's lien is that it interrupts funds' free flow to a construction project. Getting funds through will require interaction with everyone with a lien on the property. That way, the indebted party is left with little choice other than to pay creditors. Another name for a mechanic's lien is construction lien.
When it is about the supply of materials to a project, it could be designated as material man's lien or supplier's lien. When architects, engineers, and other professionals in the construction field are involved, it is a professional lien. Small-scale mechanics liens exist, such as an artisan's lien, but restrict the claim to a personal property rather than real estate. It is essentially about creditors getting the security of payment on contractual agreements. The Louisiana Construction Law governs the rights and responsibilities of persons eligible to file a mechanic's lien in the State. It is important to note that liens apply only to private construction projects and not public property. Rather than get a lien on public property, contractors may strike a bond claim in the event of non-payment. The process of filing a mechanic's lien in Louisiana facilitates in four key steps:
- Preliminary notice
- Notice of intent
- Filing of a mechanic's lien
- Release or enforcement of the lien
What is a UCC Lien?
A UCC lien is short for Uniform Commercial Code Lien. It is a formal claim to a borrowing party's collateral property to secure pending payment. Part of a UCC lien's advantage is that the first to file has the highest priority in liens. Under the Uniform Commercial Code, contractors and other staff involved in the construction of buildings can file for a UCC lien on their client's property. The Uniform Commercial Code is a set of rules that border on business transactions and applies to all states of the country, including Louisiana. Getting a UCC lien begins with a legal form that a creditor completes and files to express interest in a borrowing party's personal or business property. Upon approval, the lender will acquire a lien on the business's equipment or inventory as collateral security pending the discharge of the debt.
In some cases, a creditor can file a blanket lien. It means that all assets owned by the borrower are under alien to secure financing. Parties must provide the financing statement to the Secretary of State containing the following pieces of information:
- Name and address of the debtor
- Creditor's name and address
- Scope of collateral security, whether it is a blanket lien or a specific lien. It also describes the kind of asset it is.
UCC lien filing notices are accessible to public members, usually as newspaper publications in different localities. The validity period for UCC filing is five years. In other words, the creditor must renew the filing to sustain protected interests if the terms of the loan exceed five years. Where necessary, amendments to the UCC regulations may affect UCC listing updates. UCC liens on assets include property, real estate, bank cash, or forced sale of business assets. Non-exempt property is not eligible for liens acquisition.
How to Conduct a UCC Lien Search
A record seeker can request a certified UCC lien search in writing to one of the Parish Clerk of Court offices. The search fee costs $30 per debtor name. Alternatively, the Louisiana Secretary of State Office has a UCC database where a record seeker can conduct a UCC lien search after paying a $400 annual subscription fee. To access this database, a requester must mail a completed Application for Direct Access Service form and a $400 check to the Office at:
Louisiana Secretary of State
P.O. Box 94125
Baton Rouge, LA 70804
What is a Judgment Lien?
A judgment lien arises from a lawsuit where the filing party (the claimant) wins a money judgment case against the indebted party. A court ruling gives a creditor a legal claim to a debtor's personal property if they fail to fulfill their part of the contract. Suppose the indebted party was unable to make payments. The funds owed by the borrowing party may be collected during the foreclosure process of the property or the auction of the same. Judgment liens in Louisiana are enforceable for a total period of 10 years. The creditor can reactivate the lien as many times and for as long as they may wish, provided the borrowing party is yet to make repayments.
While most cases of judgment liens in Louisiana apply to real property, a judgment creditor can get a judgment lien on a borrowing party's non-exempt personal property. They can get this done using a writ of fieri facias. The Courts of the State of Louisiana also have the obligation of enforcing judgment liens from any court of the United States upon certification by the court that issued it. To do this, the judgment creditor must file with the appropriate court of jurisdiction an authenticated copy of the foreign judgment and an affidavit showing the name and postal address of each of the judgment debtor and creditor. Upon receipt, the court clerk must put in a written notice of filing the foreign judgment to the borrowing party using the address on the affidavit.
There is a waiting interval of 30 days after mailing the filing notice before the judgment can be enforced.
A judgment debtor can evade a lien on their property by claiming homestead exemption or a 'stay' issued by Bankruptcy Court in an ongoing proceeding. A homestead exemption of up to $15,000 is permissible by Louisiana's state Constitution (Louisiana Constitution Article 12, Sec. 9.). Homestead exemptions apply to landed property, usually not exceeding 160 acres. Others may be buildings and appurtenances. Personal property may also come under an exemption from levy or sale. Here, a writ arising from a court process will be necessary to apply for an exemption. Eligibility for exemption includes property required to exercise a trade, occupation, or profession. Matrimonial items such as wedding rings, individual retirement account domestic stocks are all examples of exemptible property. In a bankruptcy case, the borrowing party can claim exemption from liens on specific properties depending on which chapter they file.
What is a Federal Tax Lien
Per IRC § 6321, a federal tax lien is when a person (as defined in IRC 7701(a)(1) who has unpaid property taxes fails to pay them after the Internal Revenue Service (IRS) demands payment. The lien protects the IRS’ interest in all the taxpayer’s personal property, real estate, and financial assets. For a federal tax lien to exist:
- The IRS must first assess a tax against the taxpayer
- Send the taxpayer a Notice and Demand for Payment
- The taxpayer neglect or refuse to pay the debt in full as and when due
A federal tax lien remains in a property until the unpaid tax debts are satisfied or the statute of limitation has been reached (per IRC § 6322). Per IRC § 6502, federal tax liens have a 10 years statute of limitation, but there are times this 10-year collection period can be extended or suspended (IRC § 6502 and IRC § 6503). Contact the IRS for more information about unpaid property taxes and how they result in federal tax liens.
What is a Lien Title?
A lien title is a lien holder's legal claim to a debtor's property. A lien on a property title is usually created immediately when a property is financed. This simply means that the lienholder holds the property title and is considered the property’s legal owner until the debt is paid completely. A title lien protects the lienholder and allows them to repossess the property if the debtor refuses to make payments.
Where and How to Do a Title Search in Louisiana
A record seeker can conduct a real estate property title search at Parish Clerk of Court offices. Most parishes allow requesters to use the eClerks LA tool to conduct real property title searches. An inquirer who wants to conduct an automobile title search can do so online on the Louisiana Office of Motor Vehicles website. Online requesters would have to provide the vehicle’s title number, date, and last 6 numbers of VIN. Alternatively, a requester can visit the office for a vehicle title lookup. The Office is located at:
Office of Motor Vehicles
7979 Independence Blvd.
Baton Rouge, LA 70806
Voluntary Lien vs. Involuntary Lien in Louisiana?
A critical difference between voluntary liens and involuntary liens in Louisiana is that the owing party initiates a voluntary lien. It is often a requirement to secure loans from creditor organizations or agencies. Examples of voluntary liens include mortgages, security loans, and collateral. Involuntary liens are usually forced on the whole party to ensure payment of pending debts. Inclusive of this list are judgment liens and tax liens.
How Creditors Collect Payment Through a Lien
Liens serve as a safety net for a creditor's investment by helping to prevent losses. When liens are attached to a property, and the debtor fails to meet the underlying obligation, the creditor can seize and sell the liened property. The proceeds from the sale can then be used to clear the debt.
How Do I Get a Lien Removed in Louisiana?
In Louisiana, fulfilling an underlying obligation is the simplest way to remove a lien from a property. Suppose the obligation is satisfied and the lien's other conditions are met. In that case, the creditor will remove the lien by filing a release with the same authority that recorded the lien. When the lien is lifted, the property owner is free to sell, trade, or otherwise transfer the property.
Furthermore, parties who cannot pay their debt in full or on time may negotiate a partial repayment plan. The debtor may persuade the creditor to release the lien during these negotiations.
However, in some cases, liens may be filed incorrectly or through fraud, coercion, or other unethical means. The property owner may petition the court to have the lien reviewed and removed in such circumstances. Even if the debt is valid, the lienee (the debtor) can approach a court to have the lien removed if the lienor (the creditor) did not follow a legal process while filing the lien.
Another way to get rid of a lien is to wait for the statute of limitations to expire. Some liens expire after a certain length of time passes. However, this method could pose some problems because state law usually allows lienors to renew their liens.
Finally, a lienee can remove a judgment lien in the bankruptcy court under federal law. This is a more complicated procedure. As such, anyone considering this option should do so only as a last resort and consult with a bankruptcy attorney before beginning the process.
How Long Does a Lien Stay on Your Property in Louisiana?
Liens do not last forever in Louisiana. Typically, they remain attached to property until an obligation or debt is satisfied. However, legislation may affect how long a lien remains linked to a property.
For example, Louisiana law authorizes judgment liens to be valid for ten years. If this period passes and the debt remains unpaid, the creditor may renew the expired judgment by applying to the court. Furthermore, a mechanics lien claimant in Louisiana has only one year from the filing date to enforce it and collect payment. In some instances, the creditor may renew the lien.
How to Avoid a Lien in Louisiana
In most situations, avoiding debt is the best way to avoid liens in Louisiana. This means meeting all financial and contractual commitments within the specified time frame for a debtor. If a person has no outstanding debt, no liens can be placed on their properties or assets.