Can you wholesale a property with a lien on it?

Question

I'm looking into unique ways to wholesale properties. Is it possible to wholesale a property with a lien on it? If we work it into the buy price and the numbers work for assignee and they are completely aware of it? Can liens be used as an advantage when making offers because of how motivated the seller might be to get the lien out of their name? Or would you recommend staying away? Also would REI's be more likely to stay away from properties with a lien on it, or would they take the advantage of the discounted price even though they have to deal with the lien? Thanks in advance for your feedback!

Eric James · Answer

If the lien is less than the our purchase price. It would have to be paid off as part of the sale.

Peter Mckernan · Answer

@Justin Peucker You can wholesale it with a lien on it, and as you mentioned informing them about it, and the numbers account for the lien. You can for sure put it into the purchase, and it really depends on the lien and the circumstances of the lien for the property. It could be a city lien due to delinquent trash/water bills, or it could be a third on the house heading to foreclose on the house. Either way they can be stopped, fees caught up and the house being brought current.

Joe Villeneuve · Answer

Your missing my point.  If you were the REI, would you buy it.

Eric James · Answer

The lien would be paid off as part of the legal transaction to give clear title

Justin Peucker · Answer

Thank you so much! So essentially the lien would have to be worked into the sale as a part of the property being transferred?

Justin Peucker · Answer

I would be interested in working the numbers to present the offer/wholesale to an investor so that investor and I could make a profit

Justin Peucker · Answer

So if the property with a lien on it is sold it stays in the previous owners name? If so and the lien were paid off at the settlement if the property was

discounted property + lien being paid off + wholesale fee = good deal for investor to make a profit

would that be a possible deal to wholesale?

Thank you for your feedback!

Tom Gimer · Answer

Liens aren't against people, they are against property.

If a mortgage or judgment lien remains unpaid when the property transfers, it also stays in the name of the seller... there is no getting the "lien out of their name" and it will still show on credit.

Whether the property sells subject to the lien (rare) or it gets paid off at settlement (standard), that doesn't change the numbers... except that a lien that stays on title continues to accrue interest at the legal rate and can be foreclosed.

Joe Villeneuve · Answer

Would you buy one?

Justin Peucker · Answer

Thank you so much for your help I really appreciate it! How would I determine the circumstances of the lien?

Can you wholesale a property with a lien on it?

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