What to Do When Your Account is in Jeopardy of Lien or Levy

Remove My Lien What to Do When Your Account is in Jeopardy of Lien or Levy

3 Steps to Take When Your Account is in Jeopardy of Lien or Levy

If , you are probably more than a little bit worried. If it happened to you, would you know what to do? This article will explain what lien and levy are, their differences, how DoNotPay can help ease your worries.

The Difference Between a Lien and a Levy

Liens and levies are both legal tools that can be used to collect a debt.

A lien is a claim put in place by a creditor to ensure eventual payment. Some liens, such as tax liens, are public information. When a lien is in place, the property can not be sold until the lien is paid off. In the case of a tax lien, the IRS or state tax agency will remove the lien within 30 to 60 days after the lien is paid in full.

When a lien is not paid, or if the debtor does not agree to a payment plan, the creditor has the option to file and enforce a levy to seize the asset that is encumbered by a lien. With a lien, the creditor can seize bank balances and/or order withholding a portion of the debtor's wages until the debt is fully satisfied, explained at DifferenceBetween.

 are closely related, and each is part of the collection process. Levies are more serious than liens and may result in the forfeiture of your property. If you have a lien on your property, it is definitely in your best interest to deal with it before a levy is put in place.

To Summarize

Tax liens and levies are both an action taken by the government entity called the Internal Revenue Service (IRS) which punishes those who failed to pay their taxes, as well as to obtain the owed tax through seizing of their assets/property.

Tax LienAmount legally claimed by the government one’s assets/property to satisfy the tax debt.
Needs to be ordered in a court of law.
Tax LevyA much more serious way of taking/seizing one’s property forcefully to pay to satisfy the tax debt.
Does not need to go through an appeal in a court of law but only send a notice of intent.
This will be imposed on those people who have failed to make tax payments or work out an arrangement for the tax payment.

Who Can Place a Lien on Your Property?

Virtually anyone you owe money to can place a lien on your property. In the case of a mortgage or auto loan, the creditor puts a lien on the property right from the start, and the lien remains in place until the outstanding balance is paid. Others who may put a lien on your property include but are not limited to:

  1. Bank or credit union
  2. Car dealership
  3. Car lease company
  4. Civil, criminal, or family court
  5. Contractors, vendors, and repairmen
  6. Internal Revenue Service
  7. Mortgage lender

If you are late on your payments,. Filing for bankruptcy won't remove most liens or prevent a levy from encumbering your assets.

What Happens if You Don't Pay the Lien?

Not only can a lien seriously damage your credit score, but can also open the door to a levy that can lead to forfeiture of your car, house, or other assets. If a lien is not paid off, the creditor may exercise their right to file a levy and sell your property, explains Investopedia.

Can You Fight a Lien on Your Own?

There are several ways to fight a lien, and none of them are much fun. Some creditors will negotiate a payment plan with you, others may not. You may be able to negotiate a reduction in your loan amount, but there's no guarantee it will work. You can even file a claim in court if you think the lien was placed in error. If a creditor refuses to remove a bogus lien, DoNotPay can file your complaint in small claims court.

A Better, Surer Way to Fight a Lien and Prevent a Levy

DoNotPay understands what a hassle it can be to deal with a creditor, especially when they have a lien on your house, car, or other assets. That's why we invented a DoNotPay product designed specifically to remove liens. It's easy to use and a lot less trouble than trying to fight a lien by yourself.

Here's all you have to do:

  1. Search for remove my lien on DoNotPay.


  2. Start our Remove My Lien product.


  3. Answer some questions about your specific lien and let us help you craft a letter to your creditor to resolve the issue.


That's really all there is to it! Once we have your details, our artificial intelligence robot lawyer will write an effective letter and make sure it gets to the right place. Once that task is accomplished, you should hear from the creditor within 14 days.

Other Lien-Related Issues DoNotPay Can Help With

DoNotPay Can Also Address Other Issues

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