How Title Insurance Protects You Against Unrecorded Liens

07/13/2026 10:28 AM Mark Goodman

If you’re purchasing a commercial property, you or your title services team should investigate the property during the due diligence stage to look for the existence of liens against the property. These liens may stick with the property, not the individual, so it’s important that they are discovered prior to closing so that you don’t inherit someone else’s debt. Many liens are well-documented and properly recorded, and these are easy to discover during a title search, but sometimes “undisclosed” liens exist, and they can cause problems if they are missed during the investigation stage. Thankfully, title insurance exists to protect buyers against these undisclosed or hidden liens.

Undisclosed or hidden liens can exist for a few different reasons, and while an experienced title services team has a much higher chance of uncovering them, you can still protect yourself with an owner’s title insurance policy. A lien could be undisclosed because:

Improperly Filed - If the lienholder fails to properly file the lien, it could mean it is never officially entered into record. This doesn’t erase the lien from existence, it simply moves it to a purgatory-like state, waiting to be uncovered and resolved in one way or another.
Public Records Errors - An error in the public records, like listing the address incorrectly or filing a lien under a different name than the property owner, can cause liens to remain undiscovered.
Wrong Place - If the lien isn’t filed in the right location, it can remain undiscovered until the mistake is recognized.
Deliberate Concealment - Finally, a lien could remain hidden in the event that the seller knows about the lien but tries to keep it concealed during the course of the sale. This is illegal, but some parties could feign ignorance in hopes of escaping debt.

Your title team will work hard to find the properly recorded liens and any potential unrecorded liens, but it’s not always easy to find these types of liens. They are undiscovered for a reason, and even a professional can miss them because it can be like trying to find a needle in a haystack.

However, you can protect yourself from unrecorded or undiscovered liens and other potential title issues with the help of title insurance. Hidden liens don’t have to cause you financial hardship if you work with a title services team to secure an owner’s title insurance policy for a one-time fee after closing. To learn more about title insurance, or for help investigating a property you’re interested in, connect with the team at Commercial Partners today at (612) 337-2470.