How long does a lien stay on a property in Georgia?

February 10, 2016 15:25 by Consumer Ed

Dear Consumer Ed:

How long does a lien stay on a property in Georgia?

Consumer Ed says:  

There are several types of liens that can be attached to a person’s property.  Each has a different expiration date, and if successfully enforced, could result in the sale of your property to obtain the amount of the lien from the proceeds (with any remaining funds going to the property holder).  While this list is not exhaustive, the most common types of liens are: 

Tax Liens

A state tax lien occurs when taxes are due to the state, or to counties of the state, or other special tax districts of the state.  State tax liens don’t expire, and the only way to get rid of them is to pay the amount owed—otherwise, when you sell your home, the state will collect the amount owed from the proceeds of the sale.

A federal tax lien is one that the federal government can use when you fail to pay a tax debt.  A federal tax lien exists after the IRS puts your balance due on the books (assesses your liability), then sends you a bill that explains how much you owe (Notice and Demand for Payment) after you fail to fully pay the debt in time.  The lien continues until it is paid, or it expires.  Generally, the IRS has ten years to collect after it is assessed.  The IRS can extend the ten years under two different circumstances.  First, the statute of limitations can be extended if you enter into an installment agreement; this extends the expiration date to 89 days after the installment agreement expires.  The second is a release of levy with an agreement to extend the statute of limitations to a specific date, provided the extension date hasn’t passed.  A release of levy may be given if the lien is creating an immediate economic hardship.  This doesn’t mean you are excused from paying what is owed, only that you will be given some leeway to make the payments.  The IRS will generally work with you to establish a payment plan or other steps to help you pay off the balance.

Judgment Lien

A judgment  lien is created when a judgment is obtained in superior, magistrate, or other state courts.  This lien can become unenforceable after seven years, if the lien holder doesn’t seek to enforce the lien by providing public written notice of its efforts, and by including the names of the parties to the enforcement action, the nature of the action, and having it recorded in the court.  The lien holder is able to re-record the judgment every seven years to keep it enforceable; however, if the lien holder fails to re-record the lien within the seven year period, he or she has only three years after that expiration date to re-record it.  If the lien holder fails to re-record during the three years, he or she is barred from enforcing the judgment.

Laborer’s Lien

A laborer’s lien is a lien filed by a person who provides services under a contract for manual labor or physical work.  The lien can only be for the work performed, and cannot include any materials provided (but these would fall under a materialman’s lien, described below). The lienholder must go to court to obtain a judgment against you within twelve months, or the lien becomes unenforceable.

Mechanic’s or materialman’s lien

A mechanic’s or materialman’s lien is a type of lien that contractors, subcontractors, and others who have contributed services and/or materials to improve a new or existing home can file against a homeowner’s property if they do not get paid, even if the homeowner paid the general contractor.  Liens like this don’t go on your credit report, and expire within 12 months unless the subcontractor or contractor actually files a lawsuit to collect the money.  


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Can a mortgage company ask your neighbors about you if your payment is late?

February 8, 2013 00:52 by Consumer Ed

Dear Consumer Ed: 

Can a mortgage company call your neighbors when you are late on your payment and ask questions about you?      

Consumer Ed says: 

It depends on what you mean by “mortgage company”—whether that company that is your mortgage lender, your loan servicer, or both.  Your mortgage lender is the company that actually loaned you the money to purchase your home; your loan servicer is the company that handles the day-to-day aspects of your loans following the original disbursement.  Your mortgage lender and loan servicer can be the same company.  If you do not know who your loan servicer is you can check this on your monthly billing statement. Or you can call the MERS Servicer Identification System at 888-679-6377, or visit the MERS website at www.mersinc.org/information-for-homeowners/my-mortgage-info.

If your mortgage company is your loan servicer, but not your mortgage lender, these phone calls to your neighbors are regulated by the Fair Debt Collection Practices Act (“FDCPA”).   Under the FDCPA, it is legal for a third-party debt collector (such as a loan servicer) to call your neighbors, provided the content of the conversation is limited to three inquiries—your home address, your home phone number, and where you work.  All other inquiries are illegal.  It is also illegal for a third-party loan servicer, in making such inquiries, to disclose the fact that you are late on your payments or any other confidential information.

If your mortgage company is both your loan servicer and your mortgage lender, the restrictions set out in the FDCPA will not apply.  This is because technically the mortgage company is your creditor, rather than a “third-party” debt collector. 

However, there are other regulations recently put into place by the Consumer Financial Protection Bureau (“CFPB”), the federal agency charged with oversight of all financial institutions, which apply to communications between covered financial entities and third parties.  Under the new CFPB regulations tighter rules will apply. Thus, regardless of whether the company was your mortgage lender or your loan servicer, if the company and the communication it had with your neighbor falls within CFPB regulations, then the company is required to give you notice and an opportunity to opt-out of its third-party disclosure procedures before releasing information about you to your neighbors or other unaffiliated third parties.   

You can learn more about these new federal regulations by visiting the CFPB’s web site at www.consumerfinance.gov/regulations.  If you believe your mortgage company and/or loan servicing company have disclosed protected information about you in a way that violates the law, you can to file a complaint with the CFPB at https://help.consumerfinance.gov/app/mortgage/ask.

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Does maintaining a neglected property give me ownership rights?

July 10, 2012 01:35 by Consumer Ed

Dear Consumer Ed:  

There’s an empty lot next to our house. The owner doesn’t maintain it, and we end up trimming the vines and hedges that would otherwise grow over our fence.  If we continue to maintain that property, will we eventually own it?

Consumer Ed says: 

You’re thinking of adverse possession—and no, you won’t gain ownership to your neighbor’s property simply by maintaining the hedges and vines that come onto your property.  Generally, when an adjacent neighbor fails to maintain her property, it’s a good idea to talk with her first, or send her a written note asking if she could please address the out-of-control vegetation.  If she isn’t willing to do so, then it’s best to file a complaint with your city or county authorities.  Many cities and counties have ordinances requiring property maintenance.  To determine if your local government authority has such a requirement, visit its official website; if there’s no official website, or if you can’t find the ordinances there, you can go to www.municode.com, select your state of residence, then search by city or county.  If your neighbor is violating any of the local property maintenance laws, your filing a complaint could result in her receiving a violation notice requiring her to comply with those laws or face a fine.

That being said, there are circumstances where you may eventually be able to gain legal ownership to property through adverse possession.  You should consult with a lawyer to get a better understanding of these circumstances.  Generally, however, in Georgia, you can acquire property through adverse possession only if all the following criteria are satisfied:  you actually possess the property (i.e., live on it or otherwise show that you’re claiming it); your possession of the property is “open and notorious” (meaning you don’t make any attempt to hide your possession from either the owner or the public at large, and the owner doesn’t dispute your claim or make any attempt to interrupt your possession); your possession of the property is exclusive (no one else is occupying or otherwise staking claim to the property); you possess the property without interruption for the entire period of time required by state law; and your possession is accompanied by a claim of right (which simply means you’ve actually claimed the property as your own).  In Georgia, ownership of adversely possessed property can be gained if you comply with all the preceding requirements for 20 years, or seven years if the property is possessed under color of title.  Color of title simply means that a person has a reasonable belief that s/he has an actual right to possess the property.

These requirements are in place to protect the actual property owner, so that s/he will have adequate notice of a potential adverse possession.  Based on the information you provided, your circumstances would not support any ownership claims to your neighbor’s property.

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