Selling A House With A Child Support Lien in Seattle, WA

After spending several grueling months renovating your home prior to selling, searching for the right agent, and trying to time the market for the perfect sale, the worst thing that can happen is discovering a lien on your property. Finding out about a lien at the last minute will not only turn off potential buyers, but it can also bring the entire transaction to a screeching halt, causing delays, frustrations, and unexpected financial stress. 

Although uncovering the issue can feel overwhelming, selling a home with a child support lien–or any lien for that matter–is not impossible. It is, however, more difficult and requires careful strategizing, proper planning and a clear understanding of how liens affect real estate transactions in Seattle. Knowing what steps to take, who to work with, and how to navigate the process can spell the difference between a stalled listing and a successful home sale. 

What Is A Lien?

A lien indicates that there is a legal claim placed on your property due to an unpaid debt. In simple terms, the property is being used as collateral for that debt, which gives the creditor the legal right to seek payment from the proceeds of the sale. If the debt remains unpaid, the lienholder can potentially force action to collect what is owed. 

Because of this, a property with an active lien generally cannot be sold or transferred to a new owner until the lien is resolved. Most buyers and lenders will not move forward with a transaction if there is a lien attached to the title. Liens must typically be paid off, released, or otherwise cleared at or before closing in order for the sale to proceed smoothly. 

Common liens on houses include: 

• Mortgage lien: When you take out a home loan, the lender places a lien on your house to secure repayment of the loan. 
• Tax lien: unpaid taxes, such as property taxes or other government obligations, can result in a lien being placed by the government. 
• Mechanic’s Lien: Contractors, subcontractors, or suppliers can file this lien if they were not paid for work, materials, or services provided to the property. 
• Judgment lien: If a court rules against a homeowner, a lien can be placed on the property to secure payment. This can include judgments related to child support.
  

Liens can either be voluntary, such as a mortgage, or involuntary, like the mechanic’s lien. Because involuntary liens can be filed without the homeowner’s direct involvement, it is possible to be caught unaware that a lien exists until it surfaces during the title search. This often creates unexpected delays and complications during the home sale process.

Can You Sell a House With a Lien in Washington?

Yes, many homes in Washington are sold with a lien attached. However, while it is possible to sell a house that has a lien, the lien must be resolved before the sale can be finalized. A real estate transaction will not close if an active lien remains on the property, but that doesn’t mean the home cannot be listed or marketed while the lien is being addressed. 

To move forward with the sale, the lien must be satisfied, released or otherwise resolved. There are generally three ways to handle property liens when selling a home. 

1. Pay the lien before the sale

The most straightforward option is to pay off the lien before listing or closing the sale. This is the simplest solution if you have the financial ability to do so. Paying the lien in advance can make the transaction smoother and more attractive to the buyer, since they will never be aware that the property previously had a lien. Many buyers are understandably cautious when liens are involved, so resolving them early can help avoid concerns or delays. 

2. Pay the lien out of the sale proceeds

The second and most common option is to pay the lien using the proceeds from the home sale at closing. This is frequently done with voluntary liens, such as mortgage liens, and is coordinated through the title company or escrow. In this scenario, the lien holder is paid directly from the sale funds, and the lien is released before ownership transfers to the buyer. 

3. Negotiate with the lienholder

The third option is to negotiate the lien with the holder. In some cases, especially if the sale proceeds will not fully cover the debt, the lienholder may agree to a reduced payoff or settlement. This approach is more common with judgment liens or child support liens and often requires documentation, approval, and legal or professional guidance. Successful negotiation can allow the sale to proceed when full repayment is not immediately possible. 

How To Sell A House With A Child Support Lien

Preparation for selling a house with a child support lien in Washington is similar to a standard home sale, but with a few extra steps involved. In Washington State, the Division of Child Support or court orders typically enforce child support obligations, and they attach directly to the property. If your home has a child support lien, it is strongly recommended to work with a real estate professional familiar with Washington real estate laws to ensure the lien is handled correctly and does not delay or stop the sale. 

1. Run a Title Search on Your Property 

Once you believe there may be a lien on the property, the next step is to verify it through a title search. This can be done through a title company, which will identify any child support liens, judgment liens, or other claims attached to the property. A title search will show all recorded liens, and since multiple liens on a property can happen, it’s important to identify every claim early in the process. 

2. Talk to Your Lienholder 

After the title search is completed, it will indicate who the lienholder(s) are. You will need to contact the lienholder to confirm the total amount owed, including any interest or penalties. At this stage, you can discuss payment options and ask whether negotiation or settlement is possible, especially if you are selling the home and the proceeds may not fully cover the balance owed. 

3. Plan Your Next Step With a Professional 

Once you have all the details, you need to decide whether you can move forward with the sale, whether the sale proceeds will cover the lien, or if you need to pay the lien before closing. In Washington, liens filed must be satisfied or released before the property can legally transfer to a new owner. Working with a real estate professional, a real estate attorney, or a title company can help you plan the best approach and avoid closing delays. 

4. Prepare Your Home For Sale 

If you have already started preparing your home for sale, that is a great start. If not, once you have a clear plan for resolving the lien, you can move forward with staging, cleaning, pricing, and listing the property. In Seattle’s competitive real estate market, proper preparation can help attract serious buyers. Being upfront about the lien allows you to communicate clearly that it will be resolved at closing, which helps build buyer confidence. 

5. Close the Sale

After finding the right buyer, it is time to close the sale. The closing process is handled through escrow and a title company. The title company will calculate the child support lien payoff and deduct the amount directly from the sale proceeds at closing. The lienholder is paid directly, the lien is released, and the remaining funds are distributed to you. The buyer then receives a clear title to the property, free of the child support lien. 

Proceeds After Selling A Home With A Lien

When it comes to selling a home with a lien, your main focus should be on maximizing your home’s value while carefully managing your costs. Since most homeowners pay off liens using the proceeds from the sale, it is important to make sure those proceeds are enough to cover the lien and still leave money for you after closing. 

For example:

Let’s say you owe $2,000 in a child support lien and still have $5,000 remaining on your mortgage. If your home is valued at $899,000 (the median home value in Seattle), you can expect to pay around 6% in real estate agent commissions, which would total approximately $53,940. In addition, the average home sale often includes closing costs of about 2.4% of the sale price, which would come out to roughly $21,576.

Altogether, these costs would total about $82,516.

This total cost does not include additional expenses such as repair costs, which can range from hundreds to thousands of dollars, or professional services like cleaning, staging, and photography. These costs can quickly add up and should be factored into your overall plan.

Because of this, it is important to account for every expense  involved in the sale and make sure your bottom line not only covers the lien and selling costs, but also supports your financial situation after the sale is complete. 

Problems can arise if the lien amount and total selling costs exceed your variable home equity. In situations like this, you may need to negotiate with your lienholder or evaluate your method of sale. Some homeowners choose to sell the property as-is to reduce repair expenses or to explore alternatives such as selling without an agent to lower commission costs. 

Ultimately, carefully evaluating your plans ahead of time helps ensure that all obligations are met and prepared for the financial outcome of the sale. 

Tips for Selling a Washington Home With a Lien

1. Be Transparent About The Lien

The best way to ensure a successful home sale is to be honest about any liens on your property. Being straightforward with potential buyers and their agents helps build trust and reassures them that the lien is being addressed. Transparency reduces the risk of surprises later in the process and helps buyers feel confident that the sale will not fall through due to unresolved lien issues. 

2. Keep Constant Contact With The Buyer 

Maintaining regular communication with the buyer or the buyer’s agent is essential for a smooth transaction. Providing updates on the status of the lien, such as when negotiations are in progress or when the lien will be paid at closing, helps prevent doubt and misunderstandings. Lack of communication can create unnecessary concerns that may jeopardize the sale. 

3. Get A Title Search Early 

Starting the title search early is extremely important. While newer properties are less likely to have liens, older homes or properties that have changed ownership multiple times may have unknown liens attached. If the property was inherited or passed down, running a title search early allows you to uncover any issues and plan ahead, rather than dealing with last-minute delays during closing. 

4. Price The Property Competitively 

Pricing your property competitively doesn’t mean undervaluing it simply because there is a lien. If the home is in good condition and priced correctly for the market, it increases the chances that the sale proceeds will be enough to cover the lien and other selling costs. Proper pricing also reassures buyers that they are purchasing a duly valued, lien-free property after closing.  

5. Look For Alternative Ways to Sell 

Selling property the traditional way can involve high costs, including repairs, staging, and agent fees, which can add up to thousands of dollars. When a property already has a lien, taking on additional expenses may not be realistic. In these situations, you may want to consider alternative selling options, such as selling to a cash home buyer in Washington. Some cash buyers are willing to handle existing liens themselves, allowing you to sell your house fast for cash in Seattle, WA, with fewer steps and less stress. 

Frequently Asked Questions (FAQ’s) 

What happens if you don’t pay the lien?

If the lien is not paid or resolved, the sale will not go through, as the lienholder has the right to block the transaction, which can cause the deal to fall apart and allow the buyer to walk away. In most cases, a title company will not allow closing to proceed until the lien is cleared. 

How long does it take to clear a lien?

The timeline depends on the type of lien involved. Some liens can be cleared in a matter of days, while others may take weeks or even months. For child support liens, the process can be relatively quick if the balance is paid in full. However, if disputes, negotiation, or court approvals are required, the sale could be delayed by one to three months or longer. 

What if the sale proceeds are not enough?

If the proceeds from the sale are not sufficient to cover the full debt, you may be able to negotiate with the lienholder for a reduced payoff, especially if the property is your primary asset. On the other hand, if negotiation is not an option, you may need to cover the remaining balance with personal funds in order to clear the lien and complete the sale. 

Do you need to disclose a lien?

Yes, you are legally required to disclose known liens to potential buyers. This information is typically included in the seller disclosure forms along with any known defects or issues with the property in the seller disclosure forms along with any known defects or issues with the property. Failing to disclose a known lien can lead to delays, canceled transitions, or potential legal consequences after the sale. 

Can a buyer walk away if a lien is discovered?

Yes, a buyer can walk away if a lien is discovered. Many buyers are hesitant to purchase homes with liens because unresolved liens must be cleared before the property can be legally transferred to them. If a lien is not paid or released, the title cannot be transferred, which puts the sale at risk. 

Another reason buyers may walk away is that lenders are often unwilling to approve a mortgage for a property with an active lien. Without funding, the buyer may be forced to cancel the purchase. In most cases, if the lien is not cleared from the title by closing, the buyer has the legal right to walk away from the sale without penalty. 

Final Thoughts: Selling a Seattle House with a Child Support Lien

Properties with liens can seem like a major obstacle, but in reality, many homes are sold with liens every year–it happens more often than most people realize. With proper planning and the right strategies in place, you can successfully sell your home, pay off the lien, and still walk away with cash in your pocket.  

Want to sell your home with a lien?

Sell My House specializes in purchasing difficult properties, including homes with child support liens! We buy properties as-is, allowing for a stress-free and hassle-free sale without the need for repairs, staging, or showings. We can close in as little as 7 days, thanks to our in-house financing, so you don’t have to worry about the sale falling through.  

If you would like to learn more, contact us at (253) 289-3773 or fill out the short form below. It only takes a minute to get started. 

Get your no-obligation, competitive cash offer today directly to your email!