What is a lien?

A lien is a legal claim on an asset. It is a form of security interest granted by a debtor to a creditor over the property of the debtor. In Indiana, when a debtor fails to repay a debt in accordance with the terms of the agreement, the creditor may file a lien on the asset to secure the debt. Once the lien is granted, the asset is no longer owned by the debtor, but is now owned by the creditor. The lien allows the creditor to take control of the asset, repossess it, or use it to collect payment on the debt. Liens can be placed on real estate, vehicles, personal belongings, and other assets, and can remain in effect until the debt is paid in full. When filing a lien, the creditor must provide a detailed description of the asset in order to secure their claim. Once the debt has been paid in full, the lien is released, and the asset is returned to the debtor.

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