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Lien Claim
A lien is a legal claim or attachment placed against a piece of property as a means of securing payment for a debt or obligation owed. The law provides for the property to be held as security or to be sold to secure payment of the debt. For instance, a mortgage is actually a lien against a house. The home is held as security by the mortgage company and may be seized and sold by the company if the homeowner fails to make the necessary payments.
In assessing an individual's credit score many factors are taken into account with damaging financial events having a negative effect on the overall assessment or crediting "rating." Bankruptcies, defaults, foreclosures, and liens on property would all be considered as negative financial events and would have a detrimental effect on an individual's credit score. Resolving a lien by paying the debt or obligation could, however, serve to improve a credit score and would be considered an act of rehabilitation.
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