During the sale of a home, a preliminary title report is prepared prior to issuing a policy of title insurance. It shows the ownership of a specific parcel of land, together with the liens and encumbrances which will not be covered under a subsequent title insurance policy. "Clouds" on title need to be cleared up before escrow can close so it is important to review the preliminary title report early in the sales process to make sure that any issues are cleared before close of escrow.
There are a number of different types of judgments and liens that can attach to your property. Many of these will remain on title for anywhere from 1-20 years or more. Below are some of the most common types you may encounter on a Preliminary Title Report. I abbreviated some information that Chicago Title Company provided. Here is the summary:
JUDGMENTS: Money Judgments, Spousal Support and/or Child Support
These attach to all property that is owned by debtor
A judgment lien can remain attached to the debtor’s property (even if the property changes hands) from five to twenty years
A judgment in favor of the United States of America, a Federal Corporation, has a duration of 20 years
PERSONAL LIENS: Federal Tax Liens, State Tax Liens, EDD Liens, County Tax Liens
These attach to all property owned by the debtor
State’s statutes may vary greatly. These liens can remain indefinitely if the notice is refiled prior to expiration
Title will not close without a demand on federal and state tax liens
PROPERTY LIENS: Mechanic’s Liens, Notice of Action (Lis Pendens,
HOA Liens, Substandard/ Abatement Liens)
These only attach to a specific property
A Mechanic’s Lien: When a contractor or subcontractor has performed work on a specific property but was not paid upon completion of work. In California, most mechanic’s liens will expire after 90 days from the date it was recorded
A Lis Pendens: A notice of court action affecting the property. A Lis Pendens has a perpetual duration and must be released or withdrawn
Homeowner’s Association liens: Recorded when a property owner is delinquent on their HOA dues. There is no fixed duration for this type of lien, so escrow must get a demand.
Substandard Liens: Recorded by the city or county. They can include a number of issues including hazardous substances, weed abatement, or substandard dwellings. These liens do not have a fixed duration. Escrow must order a demand to find out if money is owed.