What is a 'real estate lien'?

A real estate lien is defined as a legal claim against a property that provides security for a debt or obligation. This means that when a lien is placed on a property, the lienholder has the right to take action to satisfy the debt associated with that lien by the sale or forcing the sale of the property, should the property owner default on their obligations. Liens are often used in situations such as mortgages, where a lender places a lien as security for the loan provided to the borrower for purchasing the property. This legal claim ensures that the creditor can recover the owed amount in the event of non-payment.

The other options do not represent a real estate lien accurately, as a type of insurance for real estate transactions relates to protecting against losses rather than securing a debt. An agreement between a landlord and tenant refers to lease agreements and does not encompass the nature of a lien. A government fee on real estate transactions pertains to taxes or transfer fees rather than a lien, which is a claim made by a creditor securing their financial interest in the property itself.