Selling a House With a Lien in Arizona
A lien does not stop you from selling your house. It means someone you owe has a legal claim on the property, and that claim has to be dealt with before a buyer can get clear...
Call (928) 928-4109. We make a cash offer in 24 hours. No fees, no obligation.What this means in practice
A lien does not stop you from selling your house. It means someone you owe has a legal claim on the property, and that claim has to be dealt with before a buyer can get clear title. In most sales this happens quietly in escrow. The title company finds every lien on record, gets a payoff amount for each one, pays them from the sale price at closing, and gives you what is left. Trouble starts when the liens add up to more than the house is worth, when a lien is old or wrong, or when a deadline such as a tax lien foreclosure or a trustee's sale is getting close. This page covers the liens Arizona homeowners run into most: back property taxes, HOA assessments, court judgments, contractor liens and IRS tax liens. It explains how each one works, what happens at closing, and what your choices are when the numbers are tight.
When this path makes sense
- You are behind on property taxes and got a tax lien notice
- An investor has filed to foreclose a tax lien on your house
- Your HOA recorded a lien or is threatening foreclosure
- A judgment creditor recorded a lien against you
- A contractor filed a lien over a job you dispute
- The IRS filed a Notice of Federal Tax Lien
- A sale fell apart when title found a lien
- You are not sure what liens are on the house at all
How the process goes
- Tell us what you know. Call or use the form. Tell us about the house and any liens, notices or lawsuits you know of. It is fine if you do not have the full picture yet.
- One visit and a written cash offer. We see the house once and give you a written offer for it as-is. The offer will be below open-market price. You can say no.
- Title finds every lien. The Arizona title company runs a title search and orders written payoff amounts. Now you can see, in dollars, whether the sale covers everything and what you would walk away with.
- Liens are paid and you close. At closing, escrow pays each lien from the sale price, records the releases, and pays you the rest. If the liens are more than the price, we talk through the options before anyone signs.
What it costs
You pay no commission and no repair costs, and we pay the normal closing costs. The liens themselves are your debts, so they are paid from your side of the sale. That includes the mortgage, back property taxes with interest, HOA balances, judgments and any tax liens. Some lienholders will take less than the full amount to release their claim, and some will not. That is their choice. If the total owed is more than the sale price, the sale cannot close unless a lienholder agrees to a reduced payoff or you bring money in. Our cash offer will be below what the house might sell for on the open market. When liens are heavy, every dollar of price matters, so compare our offer with what a listing would net you.
The Arizona-specific legal + regulatory backdrop
Property taxes come first in Arizona. Under A.R.S. § 42-17153, the tax lien attaches on January 1 of the tax year and is prior and superior to all other liens and encumbrances on the property, with narrow exceptions. Delinquent taxes bear simple interest at sixteen percent per year, and a part of a month counts as a whole month (A.R.S. § 42-18053). Each February the county treasurer holds a tax lien sale (A.R.S. § 42-18112). Investors bid by offering the lowest interest rate, up to the sixteen percent cap (A.R.S. § 42-18114). The investor buys the lien, not your house. You keep ownership and can redeem by paying the taxes, interest and fees (A.R.S. § 42-18151). The risk comes later. Beginning three years after the lien sale, the lien holder can file a court action to foreclose your right to redeem (A.R.S. § 42-18201). You can still redeem at any time before judgment is entered, though you may owe the investor's costs and reasonable attorney fees (A.R.S. § 42-18206). HOA liens work differently. Under A.R.S. § 33-1807, a planned community association has a lien for assessments from the time they come due. It can foreclose only if you have been delinquent for eighteen months or owe $10,000 or more, whichever comes first. The lien sits behind a recorded first mortgage. The association must give a statement of unpaid assessments within ten days of a request. Condominiums have a matching rule in A.R.S. § 33-1256. A court judgment becomes a lien on real property when a certified copy is recorded with the county recorder (A.R.S. § 33-961), and it lasts ten years from the date of the judgment (A.R.S. § 33-964). Arizona's homestead exemption protects up to $400,000 of equity in your primary home, adjusted each year for the cost of living since January 1, 2024 (A.R.S. § 33-1101). When a homestead is sold, the judgment creditor is paid only after that exempt amount and any senior liens. A contractor's lien must be recorded within 120 days after the work is completed, or sixty days after a notice of completion is recorded (A.R.S. § 33-993). It expires six months after recording unless a lawsuit is filed (A.R.S. § 33-998).
What to watch out for in liens & back taxes situations
Some patterns to avoid regardless of which buyer you talk to:
- Ignoring a tax lien foreclosure lawsuit. Once judgment is entered, your right to redeem is gone.
- Paying anyone a large upfront fee to remove liens. Payoffs are normally handled in escrow at closing.
- Assuming an old lien has expired. Ask the title company to check the dates and the records.
- Deeding the house to someone who promises to deal with the liens later.
- Waiting until the week of closing to contact the IRS. A discharge application takes time.
- Guessing at payoff amounts. Interest and fees grow, so get every figure in writing.
How this stacks up against the alternatives
If your house is worth clearly more than the liens, you have good choices. Listing with an agent will usually bring the highest price, and the liens are paid from the proceeds at closing just as they would be in any sale. If you have time and the house shows well, that is probably the better route. You can also pay a lien off directly if you have the cash, or dispute one that is wrong. Arizona law, A.R.S. § 33-420, makes a person who records a groundless lien liable to the owner for at least $5,000 or three times the actual damages, whichever is greater. An attorney can tell you if that applies. If the liens come close to or exceed the value, the choices narrow. You can ask lienholders to accept less, ask your mortgage lender about a short sale, or talk to a bankruptcy attorney about whether filing would help. Each has real costs. Selling to us fits when a deadline is close, the house needs work that a retail buyer's lender would not accept, or you want one buyer who will not back out when the title report comes in. Our price will be below open-market value, and we cannot make a lien disappear. We can move fast and work with the title company to sort out each payoff.
Questions we get
Can I sell my house in Arizona if it has a lien on it?
Yes. Liens are paid off through escrow at closing. The title company gets a written payoff for each lien, pays them from the sale price, and records the releases so the buyer gets clear title. You receive whatever is left. The sale only gets stuck when the total owed is more than the price.
What happens if I owe back property taxes?
The county has a lien that ranks ahead of nearly everything else. Unpaid taxes bear sixteen percent simple interest per year under A.R.S. § 42-18053. The lien may be sold to an investor at the February tax lien sale. You still own the house and can sell it. The taxes, interest and fees are paid in escrow.
Can I lose my house over a tax lien?
Yes, but not right away. Under A.R.S. § 42-18201, the lien holder can file a foreclosure action beginning three years after the lien was sold. You can redeem at any time before the court enters judgment, though you may owe the lien holder's costs and attorney fees by then. Do not ignore court papers.
Can an HOA foreclose on my house in Arizona?
It can, with limits. Under A.R.S. § 33-1807, a planned community association may foreclose its assessment lien only if you have been delinquent for eighteen months or owe $10,000 or more, whichever happens first. The HOA lien is behind a recorded first mortgage. Selling before that point lets you pay the balance in escrow.
How do I sell a house with an IRS tax lien?
The IRS says it releases a lien within 30 days after the tax debt is paid in full. If the sale will not pay it all, you can ask for a certificate of discharge for the property using Form 14135. IRS Publication 783 says to apply at least 45 days before the closing date. A title company or tax professional can help.
How long does a judgment lien last in Arizona?
Under A.R.S. § 33-964, a recorded judgment is a lien on real property for ten years from the date of the judgment. Judgments can be renewed, and some, such as support judgments, last until they are paid. If the house is your homestead, the creditor is paid only after the homestead exemption amount and senior liens.
What if the liens add up to more than the house is worth?
Then a normal sale will not cover everyone. The options are asking lienholders to take less in exchange for a release, a short sale approved by the mortgage lender, bringing your own money to closing, or getting advice from a bankruptcy attorney. Start by having a title company pull the full list with payoff amounts.
Will you buy a house with liens on it?
Yes. We buy Arizona houses as-is and close through a title company that pays the liens from the sale price. We are a principal buyer, not a broker or agent. Our offer will be below open-market value. If the liens are larger than any realistic price, we will tell you honestly and point you to better options.
Sources: A.R.S. § 42-17153 - Lien for taxes; time lien attaches; priority · A.R.S. § 42-18053 - Interest on delinquent taxes · A.R.S. § 42-18112 - Time of sale · A.R.S. § 42-18114 - Successful purchaser · A.R.S. § 42-18151 - Who may redeem real property tax liens · A.R.S. § 42-18201 - Action to foreclose right to redeem · A.R.S. § 42-18206 - Redemption during pendency of action to foreclose · A.R.S. § 33-1807 - Lien for assessments (planned communities) · A.R.S. § 33-1256 - Lien for assessments (condominiums) · A.R.S. § 33-961 - Judgment liens; recording · A.R.S. § 33-964 - Lien of judgment; duration; homestead · A.R.S. § 33-1101 - Homestead exemptions · A.R.S. § 33-993 - Procedure to perfect lien (mechanics' liens) · A.R.S. § 33-998 - Limitation of action to foreclose lien · A.R.S. § 33-420 - False documents; liability · IRS - Understanding a Federal Tax Lien · IRS Publication 783 - How to Apply for a Certificate of Discharge From Federal Tax Lien
If it's the right fit
If you want to know where you stand, call (928) 928-4109, Monday through Saturday, 8am to 8pm Arizona time, or use the form below. We can make a written cash offer and have a title company pull the liens so you can see real numbers. This is general information, not legal or tax advice. Talk to an Arizona attorney or CPA about your situation.
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