Can A Commercial Property Be Sold with Existing Liens? 

08/17/2026 10:43 AM       Mark Goodman

It’s not uncommon for a lien to exist on a property, especially for larger commercial properties, which is why many interested parties want to know if it’s possible to sell a commercial property with an existing lien. Yes, it’s certainly possible to do so, but the process becomes a bit more complex when liens are involved. Below, we explain how buyers and sellers can navigate existing liens during a commercial transaction. 

Before we go any further, let’s first explain what a lien is. A lien is a legal claim against a property that serves as security for a debt or legal obligation. If that debt goes unpaid, the lienholder can enforce payment of the lien by filing a lawsuit. A lawsuit can push the property into foreclosure if you’re not careful, which is why you should work to pay off liens as dictated in the terms of your agreement. 

Common examples of liens against a property include: 

• Mortgage liens 

• Property tax liens 

• Mechanic’s liens 

• Judgement liens 

• HOA liens 

Fail to pay your mortgage, your real estate taxes or that contractor who renovated your commercial property, and you may find a lien associated with your property. These liens will need to be settled in one way or another prior to closing. 

Outstanding liens are typically addressed in a few simple ways to ensure they are settled so as not to become an obligation for the new owner, as debt would remain with the property, not the individual who incurred the debt. Liens are usually settled by: 

1. Paid At Closing - Most commonly, proceeds from the sale are used to settle outstanding liens. As a title services company, we act as a neutral third party that ensures liens are closed before funds are released to a seller at closing. This confirms that the lien obligation is actually paid off. 

2. Seller Resolves Before Closing - A buyer may write in a contract that specific liens be settled prior to closing or they will be able to walk away without penalty. This is typically reserved for smaller liens where the seller has the funds to address them without needing to dip into proceeds from the sale. 

3. Buyer Assumes Obligation - A less common option is that the buyer may assume the lien obligation as part of the purchase. This may be necessary when buying foreclosed property. It’s also possible that a buyer may greatly reduce their offer because they know they’ll take on the debt, but oftentimes this requires the consent of creditors, who would rather just get paid from the seller and original lienholder. 

Purchasing commercial property with outstanding liens can be dangerous unless they are verified and settled prior to closing, which is why it is in your best interest to connect with a title services company like Commercial Partners to assist with the acquisition. We thrive on protecting our customers’ bottom line, so let us ensure you don’t end up acquiring someone else’s property and their debt. Give the team at Commercial Partners a call today for more information on how you can discover if a property has outstanding liens. (612) 337-2470.