Can You Sell a House With a Lien on It in Virginia?

Yes. A lien does not stop you selling a house in Virginia. It just has to be paid off, and in almost every case it gets paid out of the sale proceeds at closing rather than out of your pocket beforehand.

That surprises people. The word “lien” sounds like a padlock on the front door. It is really just a claim that has to be settled before clear title passes to the buyer.

The liens we see most often around Richmond

• Mortgage or deed of trust. The ordinary one. Paid off at closing.
• Delinquent property taxes. The locality has a claim. Note that Virginia cannot begin a tax sale until taxes are still unpaid on the December 31 following the second anniversary of their due date, so you usually have more room than you think.
• Judgment liens. A creditor who won a court case and docketed the judgment in the Circuit Court. These attach to real estate you own in that jurisdiction.
• Mechanic’s liens. A contractor who was not paid. Virginia has strict filing deadlines on these, and a lien that missed them may not be enforceable.
• HOA liens. Common in Chesterfield and Midlothian, where most neighbourhoods have an active association. Unpaid dues and fines can become a recorded lien.
• IRS or state tax liens. These need more lead time, because the taxing authority has its own release process.

How it actually works at closing

The title company runs a title search and finds everything recorded against the property. Each lienholder is contacted for a payoff figure. At closing, the buyer’s money pays them in order of priority, and whatever is left over goes to you.

If the liens total more than the house is worth, that is a different conversation. Sometimes a lienholder will accept less than the full amount to get something rather than nothing. That negotiation takes time, which is the main reason to start early rather than wait.

What to do first

• Find out what is actually recorded. The Circuit Court clerk’s office in your locality holds the land records, and a title company can pull them quickly.
• Do not assume an old lien is still valid. Deadlines lapse, debts get paid and releases sometimes never get recorded.
• Do not pay anything off yourself before you have a title search. People pay old claims that had already expired.

This is general information, not legal advice. If you are dealing with an IRS lien or a judgment you dispute, talk to an attorney before you sign anything.

Thinking about selling instead?

We buy houses in the Richmond area with liens on them regularly, and we work with the title company to sort out the payoffs as part of the closing. If back taxes are the issue specifically, here is how delinquent property taxes work in Virginia.