Which statement best defines a lien?

Which statement best defines a lien?

• A. A Claim on Property for a Debt
• B. A Transfer of Legal Ownership
• C. A Mortgage Note
• D. An Eviction Order

Answer: (A)

A lien is a creditor’s claim on property used to secure the repayment of a debt. This means the lender has a legal right to the property if the borrower defaults, serving as a security interest rather than transferring ownership. Ownership stays with the borrower, but the lien creates an encumbrance that can affect title and transfer until the debt is paid or the lien is released. It’s not the act of transferring ownership, nor is it the mortgage note (the document that evidences the debt), and it isn’t an eviction order (which is a court action to remove someone from a property). For this reason, a claim on property for a debt best defines a lien.

A lien is a creditor’s claim on property used to secure the repayment of a debt. This means the lender has a legal right to the property if the borrower defaults, serving as a security interest rather than transferring ownership. Ownership stays with the borrower, but the lien creates an encumbrance that can affect title and transfer until the debt is paid or the lien is released. It’s not the act of transferring ownership, nor is it the mortgage note (the document that evidences the debt), and it isn’t an eviction order (which is a court action to remove someone from a property). For this reason, a claim on property for a debt best defines a lien.