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Asset Protection Asset Protection

Protecting Your Assets

Liens on Property

A much less likely 3rd technique a judgment creditor will use to enforce a judgment is to put a lien on your home. I have never heard of a judgment creditor of an unsecured account going after a car or other personal property, so you probably don't need to worry about those assets.

A quick search of the public tax records will tell a judgment creditor whether you own a home or not, so why don't more judgment creditors put liens on property? Because they are largely ineffective. Here's why.

Most people live in their homes a very long time. A property lien cannot make you sell your home; it just sits there until you want to sell your home. If you want to sell, most buyers are going to want a clean title and so you will likely have to satisfy the lien to complete the sale of your home.

However, a lien is only valid for as long as the judgment is valid. Eventually, the statue of limitations on the judgment will expire and so will the lien—and if you are planning on living in your house for a while, you probably won't notice a thing.

The bottom line is that liens on property cost money and are largely ineffective. It's not that they don't happen, but they are the least employed method of judgment collection.

Note: if you live in a community property state, creditors can come after you and your spouse's assets, so having property in the other's name won't provide any protection.

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