What is a Lien in Arizona?
Liens in Arizona are legal claims recorded against a debtor's property with or without their consent. They are a means for creditors to collect what they are owed because it often guarantees debt repayment. If a creditor asserts a lien on a debtor's property or asset, it becomes collateral for a debt.
Arizona liens are publicly recorded in the county where the property is located. Creditors can file and record liens at the county recorder's office. However, only Arizona courts are authorized to issue the supporting documents or judicial order required to enforce a lien.
Are Liens Public in Arizona?
In Arizona, liens are public records available to the public. They are generally managed through the county recorder’s office in which they were filed, and they can be viewed in person at their respective county recorder's offices or online via third-party sites.
Types of Lien in Arizona
When an individual has unpaid bills, unpaid taxes, overdue mortgage payments, or other pending financial obligations in Arizona, the creditor can file a lien against the debtor's property. The lien establishes the creditor's legal claim on that property to collect the debt.
Liens are different and serve distinct purposes. For example, a lien can be attached to an individual's property to obtain a monetary award granted by the court (also called a judgment lien). It can be placed by a federal, state, or local tax authority to recover overdue taxes (tax lien). Also, it can occur as a consequence of failing to pay for a home improvement project (mechanics lien) or failing to pay restitution to a victim (restitution lien). Nevertheless, all liens can be classified as voluntary or involuntary and general or specific.
A lien that attaches all of a debtor's real or personal property is considered a general lien, and a lien that affects only one property is a specific lien. Meanwhile, a lien created with a debtor's deliberate cooperation is a voluntary lien, and one established without the debtor's consent is an involuntary lien. One example of an involuntary and general lien is a child support lien, and an example of a voluntary and specific lien is a mortgage lien.
Property Lien Search by Address in Arizona
Different kinds of liens can exist on a property. As a result, one may be unaware that a lien was attached to their property. Because property liens are publicly filed in the county recorder's office where the property lies, individuals can contact these offices to find out if a property has a lien. Several county recorder's offices also provide online databases to search recorded documents. An example is the Maricopa County Recorder's Document Search tool.
However, note that records at the county recorder's offices are indexed by the names of property owners. For this reason, an inquirer can only search for liens on a property with a name, not an address.
Free Property Lien Search by Address
Any property lien search through the county recorder's offices in Arizona is offered to the public for free. It is only when a person requires copies of documents that the recorder assesses a fee.
As previously stated, Arizona's recorder offices do not offer a free property lien search by address since they organize their records by name. Individuals who wish to conduct a property lien search by address in Arizona may utilize a third-party service instead. However, a fee is often assessed to find liens on a property using third-party services.
What is a Property Lien in Arizona?
A property lien in Arizona is a notice that affirms that an alleged debt is owed. It shows that a creditor claims a debtor's real estate or personal property if a contractual obligation is breached. This lien gives creditors the right to sell the real property to pay off a debt, usually through the foreclosure process.
How Do You Know if a Property Has a Lien in Arizona?
Ordinarily, an individual with a voluntary lien against their property will be aware of the lien since it originated from a mutual agreement with a creditor. In this case, a party can uncover liens on that property by simply asking the owner. However, more than one lien can exist on someone's property, and some might be involuntary liens. Since involuntary liens can be attached without the property owner's consent, the owner might be unaware, even though they are required to receive a notice before the creditor files a lien.
The best bet to discover liens against properties in Arizona is to search public records maintained by the county recorder's offices, Arizona Secretary of State, or Motor Vehicle Division. An individual can also hire a title company or attorney to find property liens.
How Do I Check for Liens in Arizona?
An individual interested in checking for liens against real property in Arizona must first learn the property's address and the property owner's name. The former will help know which recorder's office to query, and the latter will help filter searches.
After locating the proper county recorder's office, the next step is to visit that office to inspect records or check the recorder's website for a public records search tool. Some offices - including those in Gila County, Maricopa County, Pima County, and Pinal County - maintain websites for document searches. Furthermore, some offices (e.g., the Apache County Recorder) provide a request form that can be downloaded online and mailed to obtain copies by email, fax, or mail.
The county recorder charges a fee to duplicate records per Ariz. Rev. Stat. § 11-475. For non-commercial requests by civilians, the offices charge $1 per page for copies of records and $3 per page for the certification of copies. This fee applies regardless of the method used to obtain a copy from the recorder's office.
On the other hand, the Arizona Secretary of State provides a UCC Lien Search tool online that the public can access to view and print records of standard, tax, utility, racketeering, and restitution liens against personal property. Individuals can also purchase the Uniform Commercial Code (UCC) database, with over 200,000 liens filed in Arizona, from the Arizona SOS's Business Services Division. The database will contain a complete listing of liens, associated filings, debtors, and secured parties.
An individual checking for vehicle liens on an Arizona titled vehicle may sign into their AZ MVD Now account on the Arizona Motor Vehicle Division's website to find liens and pending financial commitments.
Free Lien Search in Arizona
In Arizona, government agencies that offer lien searches do not require individuals to pay for access to those records unless the request is to copy a record. This means that such records are completely searchable for free via the internet or by visiting the appropriate office.
Depending on the type of liened property (real estate, personal property, or vehicle), a lien search can be conducted remotely through websites provided by the county recorder, Secretary of State, or Motor Vehicle Division, as explained above.
Generally, online searches should return:
- The recording date, time, and number
- Debtor's name
- Secured party's name
- Total number of pages in the document
- Type of lien
- The lien lapse ("expiry") date
- The docket/book and page numbers
- Unofficial document images
What is a Tax Lien in Arizona?
A tax lien in Arizona is a security interest placed on real estate because of unpaid taxes. Tax liens are involuntary and general because they are placed mainly on real or personal properties and without the property owner's consent.
Asides from being a debt collection claim, tax liens can also be lucrative forms of investment. Arizona property taxes have the highest lien priority, making the investment safe and common. Investors in Arizona can purchase tax liens at auctions in the same way they bid for and purchase real properties. If the property owner cannot pay past-due taxes, the treasurer offers a tax certificate for purchase at a public auction. Hence, members of the public buy tax liens to obtain property ownership or to obtain very high-interest rates.
Depending on the county, treasurers can handle the tax lien auctions either online or hold live auctions. Entities interested in bidding must register with the county treasurer, receive a bidding number, open an account, and provide a Social Security Number. Even after the tax lien auction, property owners are allowed to redeem their properties. State law gives the owner three years to redeem the property and prevent foreclosure.
Tax Lien Lookup in Arizona
To look up tax liens filed in Arizona, an individual may visit the recorder's office in the county where the property lies or search the land records database on the recorder's website (if provided).
Note: According to the Department of Revenue, it takes around 2 to 3 weeks for a state tax lien to be released after the taxpayer pays the debt online and about 45 to 60 days for a release if the taxpayer paid by personal check. Individuals should wait this amount of time before performing the tax lien lookup.
What is a Mortgage Lien in Arizona?
A mortgage lien is a common type of real estate lien in Arizona. It is a voluntary and specific lien attached to real estate to secure a creditor's payment if the debtor does not pay a mortgage. Generally, it is a financial claim on a borrower's real property, which serves as a collateral or real security. If the owner defaults and cannot make a payment for a loan, the lien allows the lender to take possession of the property and sell it to pay outstanding debt.
This type of lien is usually initiated when an entity borrows money (usually, from a financial institution) to buy or improve a piece of real estate. The lender gives the entity money after confirming that the property has a clear title. If it does, the property owner signs a mortgage, providing security to the debt. This transaction is recorded in the public land records to put a lien on the property.
What is a Mechanics Lien in Arizona?
A mechanics' lien is attached to a property as leverage to receive payment for services rendered to build or improve the property. Contractors and material suppliers primarily file this lien to ensure that payment is secured for labor and other services regardless of a construction project's liquidation. The following parties can file a mechanics lien claim in Arizona:
- Material suppliers
- Equipment lessors
When initiating a claim, these parties are mandated by law to deliver a preliminary notice to the property owner within 20 days of providing a service. Afterward, an Arizona mechanics' lien form should be prepared. The lien form must contain accurate information and it must be filed in the county recorder's office of the county where the property is located. In Arizona, a claimant has 120 days from completing the project to file a lien.
The lien form must include the following information:
- Adequate description of the property
- Name of the property owner who hired the professionals
- Amount of the claim
- A statement of the contract's terms
- The date that the project was completed
- The date that the preliminary notice was delivered
After filing the form, the owner must be served with a copy within a reasonable time. The claimant has six months from the filing date to enforce this claim. The deadline cannot be extended; hence, the lien becomes unenforceable if the six-month period passes.
For a mechanics' lien to be valid, the claimant must record it with the county recorder in the county where the job took place. Mechanics' liens are matters of public record because they give notice to future buyers of the real estate in question. These records are accessible through the county recorder's office.
What is a UCC Lien?
The Uniform Commercial Code (UCC) is applicable to every state in the United States of America. These uniform laws generally cover the sales of goods and securities. The UCC lien permits a lender to establish a priority claim for a borrower's assets, ensuring that the lender collects debts. The Arizona Secretary of State processes these liens. Entities can file via the following means:
Secretary of State
Attn: UCC Dept.
1700 West Washington Street, Fl. 7
Phoenix, AZ 85007-2808
In-Person - Phoenix Office
State Capitol Executive Tower
1700 West Washington Street
In-Person -Tucson Office
Arizona State Complex Building
400 West Congress
First Floor, Suite 141
For further questions and assistance, filing parties can contact the office directly via email or phone at (602) 542-6187 or (800) 458-5842
How to Conduct a UCC Lien Search
A UCC lien search uncovers all claims filed against a business or individual under Title 47 of the state's Revised Statutes because of a commercial transaction.
Anyone who wants to conduct a UCC lien search in Arizona may utilize the UCC lien search feature on the Arizona Secretary of State's website. With this tool, individuals can find lapsed and current liens.
To carry out the UCC lien search, the inquirer must have the debtor's correct legal name. Using a former name may also reveal past or active liens filed under that name. Because people bear similar names and cities have similar street names, an inquirer must verify the information provided after the search. One way to ensure accurate results is to know other information about the lien. For example, the lien's filing date.
What is a Judgment Lien?
In Arizona, a judgment lien is a non-consensual or involuntary lien placed on an entity's property or assets. Typically, it is ordered along with a judge or jury's verdict in a civil court case, when the court orders one party to pay another what is owed. However, defendants or debtors do not always pay their dues; therefore, the judgment lien ensures that the plaintiff or creditor gets paid.
Unlike other states in the United States that attach judgment lien to real and personal property, Arizona only permits judgment liens on real properties such as houses, lands, condos, etc. A creditor seeking to attach a judgment lien to property must file and record the court's ruling or judgment with the county recorder in the county where the debtor's property is currently located, or where it will be located in the future. The judgment lien remains attached to the debtor's property for five years.
Because judgment liens can become complicated legal issues in Arizona, claimants are advised to seek legal assistance or acquaint themselves with the state laws that govern the filing and execution of judgment liens in the state.
What is a Federal Tax Lien
Per IRC § 6321, a federal tax lien is the government's claim against a person's property because of unpaid taxes. In line with the Sixteenth Amendment, the Internal Revenue Service (IRS) is the federal agency assigned to collect federal taxes in the United States. When a person fails to pay their federal taxes, the IRS assesses their debt and sends a payment demand to them. If the person neglects or refuses to pay the debt, the IRS places a federal tax lien on the person's assets.
When the IRS attaches a federal tax lien, it affects all assets presently owned or later acquired by the debtor, including their real properties, vehicles, and securities. Federal tax liens also attach to a tax defaulter's business property, rights to business property, and accounts receivable for a business. Federal tax liens remain affixed to a property even if the owner files for bankruptcy.
What is a Lien Title?
A lien title is a lawful claim that proves a piece of property belongs to a lienholder until a debtor pays off their debt. Failing to settle the debt can lead the lienholder to repossess the property.
Where and How to Do a Title Search in Arizona
Interested persons may perform a title search in Arizona in person or online. An in-person title search can be performed at the Registry of Deeds office in the county where a property is situated. Many county recorders also provide online search tools on their websites.
Individuals can also use third-party sites to perform the title search or hire a title company to search on their behalf.
Voluntary Lien vs. Involuntary Lien in Arizona?
As part of the condition of giving out a loan in Arizona, creditors lay claim to properties and assets as collateral. Creditors can attach liens to an asset, with or without the borrower's consent. A voluntary lien is placed on an asset with the borrower's permission, while an involuntary lien claim is attached without the borrower's authorization.
How Creditors Collect Payment Through a Lien
Because liens give creditors certain rights over a debtor's property, any creditor who files a lien can seize a debtor's property and sell it to collect payment. However, the property may be low-value or have too many liens attached. As such, the sale proceeds may not be sufficient to satisfy the debt.
Nevertheless, the real advantage of a perfected lien comes when a debtor needs to sell, transfer, or refinance their property. In most cases, the lien will hinder such actions, making the debtor more willing to pay the creditor to clear the property's title.
How Do I Get a Lien Removed in Arizona?
Apart from the court, only the lienholder has the right to release a lien in Arizona. For this reason, a debtor must pay the creditor to remove the lien from their property unless the party can prove that the lien is wrongful, fraudulent, or inaccurate in court. For instance, suppose the property owner wins the court case, and the invalid lien was recorded against real property. In that case, the lienholder is liable to pay at least $5,000 or three times the actual damages resulting from the recording, whichever is greater, plus reasonable attorney costs to the property owner (A.R.S. 33-420).
Another way to clear a lien is to wait out the statute of limitations. A statute of limitations is a period given by law for the execution of certain actions or claims. For a lien, the expiration of this period means that the creditor loses the security interest in the debtor's property. However, not all liens are affected by the statute of limitations, and even if they are, state law allows creditors to renew their liens in most cases. Hence, it may be more prudent to pay off the debt or challenge the lien in court to discharge it, as the lien may never expire.
How Long Does a Lien Stay on Your Property in Arizona?
The length of time that a lien stays on a person's property in Arizona lien depends on the type of lien. A mortgage lien will ordinarily linger until the debtor pays off the debt or the creditor repossesses the property. In contrast, a judgment lien is valid for ten years from its recording date, and a mechanics lien stays effective for six months from its filing date.
How to Avoid a Lien in Arizona
Liens occur because of unpaid debts or loan defaults. Hence, the best way to avoid a valid lien in Arizona is to fulfill one's financial obligations promptly, whether this obligation relates to taxes, mortgages, utilities, judgment awards, paying contractors, and so on.