"Free and Clear" lien on Data Tree - Worth it?

I was wondering if anyone had an opinion as to whether using the "Number of Open Liens" field in Data Tree (or any other software) was a good way to narrow a search down. I find that it can get the results down about 75% if I change that field to "free and clear"

I guess I am asking have any of you found that liens on a [property are actually a pro instead of a con when looking for prospective sellers?

I am new to this, my brother in law are about to close on our first buy so we dont have a lot of experience yet and any help would be appreciated.

That's actually a really good question. First, I think it depends on whether DataTree actually has the data for this particular item in its database (if the list is coming from a California county, there's a good chance they have it... but outside of California, I'm not so sure). I've never tried sorting a list by this item before, so I can't say from personal experience, but assuming the data is there, and it's reasonably current... I can kind of see it going either way (in terms of helping or hurting your goal of finding motivated sellers who will accept a lower price). It depends what kind of outstanding lien it is, and what the balance is.

For instance - if it's a mortgage lien (standard home loan) on the property, I could actually see this hurting your effort, because most of these sellers will need a higher offer in order to pay off their loan on the sale (i.e. - they won't have as much equity to play with). Whereas if a property is owned free and clear, the owner would have a lot of flexibility (from a loan payoff standpoint) to accept a lower offer.

On the flip side, if it's a delinquent tax lien or some other issue, it could indicate that the property has been neglected and the seller either can't afford it or doesn't care about it, and they would be your classic motivated seller... so it kind of depends.

I'm not sure if it's enough to know simply that there's an outstanding lien, you'd have to know what the balance is relative to the property value, and if possible, what the lien is for.

Personally I havent used the datatree reports but have a guy on fiverr to a title and lean search for me...

I think Seth has the right idea for the most part. I believe the "Free & Clear" filter is only for voluntary liens such as mortgages. It may also be worth discussing your questions with your DataTree Account Manager (if you don't know their contact information, you can email [email protected]). Hope this helps!

1 Like