Finding out there’s a lien on your house can feel like you’ve lost control of it. The good news is that a lien doesn’t usually stop you from selling. It means that a debt is attached to the property, and that debt has to be dealt with, almost always out of the sale proceeds, before a buyer gets clear title.
This guide explains the liens Brantford homeowners most often run into, how each one works under Ontario and federal rules, and how a sale can pay them off. It’s general information, so have a real estate lawyer review your title and your options.
What a lien actually is
A lien, or charge, is a claim registered against your property for money owed. When you sell, the buyer’s lawyer searches the title and finds every registered claim. Those have to be paid or otherwise removed at closing for the buyer to get clean title. In general, claims rank by the order they were registered, so a mortgage registered first usually gets paid before a later lien.
Your mortgage is a charge too, but most people mean something else when they say “lien.” Here are the common ones.
CRA tax charges
When someone owes income tax, or GST or HST, the Canada Revenue Agency can certify the debt in the Federal Court. That certificate works like a court judgment, and the CRA can then register it against land in Ontario. Once it’s on title, it stays with the property and interest keeps building on the debt.
At closing, a CRA charge is usually paid from the proceeds and discharged, much like a mortgage. If the proceeds won’t cover everything, it may be possible to ask the CRA to discharge the charge in exchange for the available net proceeds so the sale can close, with the remaining balance handled separately. That conversation goes much better weeks before closing than the day of.
Construction liens
Under Ontario’s Construction Act, a contractor, subcontractor or supplier who wasn’t paid for work on your property can register a lien. The timelines are strict:
- The lien generally has to be registered within 60 days after the contract was completed, abandoned or terminated.
- It then has to be perfected, by starting a court action and registering a certificate of action, within 90 days after the last day it could have been registered.
- A lien that isn’t perfected in time expires and can be removed from title.
If you dispute the amount and need to sell before the dispute is resolved, the Act allows a lien to be vacated from title by posting security with the court, which covers the claim plus an allowance for costs. Your lawyer arranges this through a court order. It lets the sale close while the argument over the money carries on separately.
Property tax arrears and tax sales in Brantford
Brantford is a separate single-tier city, independent of the surrounding County of Brant, so property taxes on a Brantford home are owed to the City of Brantford. Unpaid property taxes get special treatment under Ontario’s Municipal Act:
- Once taxes have gone unpaid for the two years before January 1 of a given year, the municipality can register a tax arrears certificate on title.
- From registration, the owner has one year to pay the full cancellation price, which covers the arrears, current taxes, interest, penalties and the municipality’s costs.
- After registration, partial payments are generally not accepted unless the owner signs an extension agreement with the municipality before the year is up.
- If the cancellation price isn’t paid, the property can be sold by public tender.
A tax sale is a forced sale with no regard for your equity, so if a tax arrears certificate is on your title, selling the house yourself before the one-year period ends is usually far better. The tax debt is simply paid from your sale proceeds.
Judgments and other registered claims
If a creditor sued and won a judgment against you, they may have filed a writ of execution with the sheriff, which a buyer’s lawyer will find when searching your name. Second mortgages, private loans and family loans registered on title also show up. Each one needs a payout statement from the creditor before closing.
How liens get paid off when you sell
The process is more routine than it sounds. Your lawyer orders a title search, requests payout or discharge statements from every creditor, and pays each one from the sale proceeds on closing day. The balance goes to you.
The tricky cases are when the claims add up to more than the house is worth, or when you dispute a lien. In those situations, your lawyer may negotiate reduced payouts with creditors, or use a court process to remove a disputed lien. A firm written offer helps because creditors can see exactly what’s available.
A note on Brantford homes
Brantford grew up as an industrial centre on the Grand River, and the “Telephone City” still has a good stock of older homes around downtown and streets like Dalhousie and George. Older houses tend to have seen many contractors over the years, and occasionally a forgotten unpaid bill turns up on title when an owner finally goes to sell. It’s worth running a title search early, before you’re under contract, so nothing catches you off guard.
Selling to Sell House Cash with liens on title
We buy Brantford houses as-is, including those with liens, tax arrears and other claims on title. We pay with our own funds, so there’s no lender on our side worried about the title history.
We work with your lawyer to get every payout figure, give you a written offer, and you choose the closing date. When title can be cleared at closing, we can close in as little as a couple of weeks. There’s no commission, so more of the proceeds go toward clearing your debts.
Next steps
If you’d like to know whether a sale would clear what’s on your title, get a cash offer and share it with your lawyer. You can also read more on our Brantford page.
Frequently asked questions
Can I sell a house that has a lien on it?
Usually, yes. In most cases the lien is paid out of the sale proceeds at closing, the same way a mortgage is, and the buyer receives clear title.
How do I find out what’s registered on my title?
A real estate lawyer can run a title search for you. Title searches are also available through Ontario’s land registry system. Search early, before you’re under contract, so there are no surprises.
What if the liens add up to more than the house is worth?
It may still be possible to sell. Your lawyer can try to negotiate with creditors, who may accept less to release their claim rather than wait. Get legal advice before you sign anything.
A contractor put a lien on my house that I think is wrong. Can I still sell?
Often, yes. Ontario’s Construction Act allows a lien to be removed from title by posting security with the court, so the sale can close while the dispute continues. A lawyer can tell you whether that makes sense in your case.