People every where are loosing their jobs and when this happens they cannot pay their bills. During times like these we are seeing more and more companies implementing legal action when they are left with no other way to collect a debt. After all the phone calls have been made and all the letters have been sent and delivered companies will resort to their last resource and this is litigation in which case a judgment will be filed against an individual.
If you have ever fallen past due with a creditor and they filed a judgment against you that same judgment could be filed against your real estate property. Now a judgment will cloud your title. If you attempt to sell your property the judgment will have to be paid off as part of the proceeds and if there is not enough equity in your property the judgment could stop the sell of your property. The best way to have a judgment removed is to pay it off and have the creditor that placed the lien on your property prepare a release of lien.
This is a form or document which shows that you did in fact pay off your lien or judgment then that same form has to be filed with the court. If you are having some type of mortgage done like a second mortgage the lender that is preparing your loan will normally make sure this is done when the real estate transaction is being handled. The lender will prepare the mortgage, promissory note, the legal description and all of the other paperwork necessary to complete your mortgage transaction including the release of lien document. Your lender will also make sure that a check is sent to the creditor that placed the lien on the property in the first place.
Once the creditor is paid and the release of lien or the satisfaction of judgment form is completed and filed with the court the lien will show up on your property as being paid in full. Your property will no longer be considered clouded. It will reflect that you have a clear title at least in regards to that judgment. Creditors will use lien as a means to make sure that they are paid. It may not be right away but at some point in time you will have to pay that judgment off. I have seen some liens filed against properties that did not get paid until five or six years later.
Sometimes if an organization has been purchased by another company the lender must track down the company that placed the lien. This can really get difficult if the organization was sold to another then to another and finally merged with another company. As time goes by this can get quite complicated.