You have a lien on the house — a tax bill, an unpaid contractor, an HOA debt, a judgment from years ago. You need to sell. The question isn’t whether the lien allows it. It does. What matters is whether your equity covers the amount and what kind of lien you’re dealing with.
The short version: A lien is a debt attached to the title, not a lock on the door. In almost every case you can sell — the lien gets paid at closing from the proceeds, and the title transfers free and clear to the buyer. What changes is the timeline and who can close without flinching. We make a cash offer within 24 hours regardless of lien type, and close in 7 to 14 days once title is clear.
How liens actually work at closing
Before any sale closes, a title company runs a title search. It finds every lien on record — your mortgage, any second lien, tax arrears, contractor filings, HOA debt, court judgments. Every one of those goes on the settlement statement. They get paid in priority order from the sale proceeds before you receive anything.
So if your house is worth $180,000, you owe $140,000 on the mortgage, and there’s a $12,000 IRS lien, you’d walk away with roughly $28,000 minus closing costs. You don’t have to show up with cash. It all runs through the title company.
That process works the same whether you’re selling through an agent, selling to an iBuyer, or selling directly to us.
The situation where this breaks down: when the liens add up to more than the sale price. If your mortgage, back taxes, and a contractor’s lien together exceed what the house can reasonably sell for, there are no proceeds left to pay them. We’ll get to that below.
The lien types you’re most likely dealing with
Not all liens are equal. Some are routine. Some delay a sale. A few need court involvement. Here’s what each one typically means for your closing:
| Lien type | What triggers it | How it resolves | Likely delay |
|---|---|---|---|
| Mortgage / HELOC | Voluntary — you signed for it | Paid first at closing | None |
| Property tax (T.C.A. § 67-5-2101) | Unpaid county or municipal taxes | Paid from proceeds | None if equity covers it |
| IRS federal tax (26 U.S.C. § 6321) | Unpaid federal income or payroll taxes | Paid from proceeds, or Certificate of Discharge | 4–8 weeks if discharge needed |
| Mechanic’s lien (T.C.A. § 66-11-112) | Unpaid contractor or supplier | Paid from proceeds or negotiated payoff | Possible negotiation |
| HOA dues (T.C.A. § 66-27-415) | Unpaid association assessments | Paid from proceeds | None if equity covers it |
| Judgment lien (T.C.A. § 25-5-105) | Court judgment recorded in county | Paid from proceeds | None if uncontested |
Mortgage and HELOC liens are voluntary — you signed for them. They’re paid first at closing. No surprises unless the payoff is higher than you expected. Ask for a 10-day payoff statement before committing to a sale date.
Property tax liens accrue interest and penalties in Tennessee. The longer they go unpaid, the larger the number. The title company pulls the exact payoff figure from the county. If taxes have been delinquent long enough that the county has started a tax sale process, that’s a separate clock from a mortgage foreclosure — both can run at the same time.
IRS federal tax liens attach to everything you own, including real estate. They have to be paid from proceeds. If the sale price won’t cover the full amount, you or your attorney can request a Certificate of Discharge (IRC § 6325(b)) — the IRS releases the lien from that specific property while the underlying tax debt continues. Plan on 4 to 8 weeks to process one if you need it.
Mechanic’s and contractor’s liens in Tennessee must be filed within 90 days of the last day work was performed (T.C.A. § 66-11-112). Once filed, the contractor has one year to sue to enforce it. After that, the lien expires. If you’re dealing with an inherited house that has been sitting, there may be old contractor liens on title already past their enforcement window — a title attorney can clear those.
Judgment liens become a lien on your Tennessee real property once recorded at the county register’s office (T.C.A. § 25-5-105). They last 10 years. The lienholder gets paid from proceeds, or they can accept a negotiated payoff if equity is thin.
HOA liens — unpaid dues become a lien the association has the right to foreclose in Tennessee. HOA foreclosures move slower than mortgage foreclosures, but they happen. Dues and any attorney fees the HOA has run up appear on your payoff statement at closing.
What a cash offer changes
When you sell through an agent to a buyer using a mortgage, the lender does its own title review. If there’s an unresolved lien or a title question, the lender can pull financing — which collapses the sale after weeks of work. Lenders are risk-averse.
A cash buyer doesn’t have that layer. We work directly with a title company to handle whatever is on title. An IRS lien, a contractor claim that needs to be negotiated down, HOA arrears where the association is running its own foreclosure clock — none of those end the conversation. They’re paperwork.
Our timeline: an offer within 24 hours of getting the property address. Close in 7 to 14 days once title is clear — or hold the date longer if you need more time. You pick. No agent commission, no closing costs on your end, no repairs required. We buy as-is.
If you’re also dealing with a delinquent mortgage and worried about the auction date, read what selling before foreclosure actually involves — the timeline is shorter than most people expect in Tennessee.
When you should not sell to us
If your liens total more than the house is worth, a cash buyer doesn’t fix the math. You’d owe money at closing. Options in that situation include negotiating a short sale (requires lender approval), a deed in lieu of foreclosure, or bankruptcy protection — all of which need an attorney and none of which we can arrange.
If you have a disputed lien — a contractor’s claim you believe is fraudulent, or a judgment under appeal — resolving the dispute first may be the better move. A contested lien can cloud title and delay any sale, with us or anyone else.
And if the house is in solid shape, you have 60 days or more, and there are no liens that would complicate a financed buyer’s underwriting, an agent listing will likely net you more money. We buy at a discount relative to the open market. You trade price for speed and certainty. If the timeline isn’t pressing, that trade may not be worth making.
For houses that have passed to an estate and may have multiple liens from deferred maintenance or medical judgments, the probate sale process has its own rules — worth reading before you commit to any timeline.
Straight answers
Does the buyer pay my lien?
No. The lien gets paid from the sale proceeds before your net. The buyer receives clean title.
What if I can’t cover the lien from proceeds?
That is a short-sale or upside-down position. It requires negotiation with the lienholder — sometimes that works, sometimes it doesn’t. Call us and we can tell you what we’re seeing.
Can I sell with an IRS tax lien on the property?
Yes. IRS liens are paid from proceeds at closing, or cleared through a Certificate of Discharge under IRC § 6325(b) if proceeds won’t cover the balance. Talk to a tax attorney about the discharge process if you’re in that situation.
How long does a mechanic’s lien last in Tennessee?
One year from the filing date, if the contractor doesn’t file suit to enforce it in that window. After that, it can be removed from title.
Will the lien lower what the buyer pays for the house?
The lien affects your net proceeds, not necessarily the purchase price. A cash buyer evaluates the property condition and market value. What you walk away with depends on how much the liens subtract from the sale price.
Can one lien block the sale if there are several?
Only if its holder objects and takes legal action before closing. In practice, most lienholders want to be paid — they have no reason to block a sale that will pay them.
One step
Give us the property address. We’ll have a cash offer back to you within 24 hours. The lien gets handled at closing, not before. No fees, no commissions, no pressure to accept. Call (615) 780-7349 or drop the address in the form below.