Creditors file claims against a debtor's property to secure a debt. The claim, or lien, prevents the debtor from selling or transferring the real or personal property until the debt is paid. Once the debt is paid in full, the creditor gives the debtor a lien release to file that removes the lien. If the lien release is lost before it can be filed, the debtor must obtain a replacement.
Call the person or company holding the lien on the property to request a new release. It is not unusual for a lien release to be lost or misplaced before it can be filed. Banks and finance companies routinely replace lien releases that are lost or misplaced by debtors. Give them your name, account number and the date the debt was paid. Some creditors want the request for a replacement lien release to be made in writing.
Contact the Federal Deposit Insurance Corporation (FDIC) if the lender is a bank or savings and loan institution that failed. The FDIC takes over failed lending institutions and has access to their records. The FDIC has customer service offices throughout the United States. Select the office that handles your state and send a written request by mail, email or fax. State in the letter that you are requesting a lien release. Include the name of the lending institution and a copy of the filed lien. Include proof the debt was paid to avoid delays.
Read More: How to Release a Property Lien
Hire an attorney to start a court action to release the lien. If the holder of the lien will not cooperate by replacing the lost lien release, file a lawsuit to obtain a court order releasing the lien. Proof must be submitted to the court proving the debt has been paid in full to obtain the court order. A court action to release a lien is a complex legal proceeding for which you will need an attorney.
Dennis Masino practiced and taught law for many years before he began writing professionally in 2009. His articles on law, real estate and business topics can be seen on many websites. He is the author of two published books on drunk driving laws and holds degrees in law and finance.