Injustice in the current system of mortgages and mortgage lending in America is something millions of Americans have experienced firsthand. After enduring the demeaning process of foreclosure and the catastrophic loss of years of equity value buildup, most are left near penniless. After years of service to our corrupt system of banking and fake money creation using fractional reserve banking and fake mortgage lending by simply monetizing our signed promissory note instead of providing an actual mortgage loan like we were lead to believe we were getting, millions are saying, ENOUGH!
The problems of our system aside, if you are facing foreclosure you should utilize every means available to either completely stop the foreclosure or at least secure and prevent the loss of your personal equity in the property. Through the use of the little known Common Law Lien, many homeowners facing foreclosure are doing just that.
The Common Law Lien provides a lawful method of ensuring that your equity is protected. You too can lien your own property, establishing a claim against your interest in the property. A Common Law Lien secures the interest of the property owner/lienor in his own property. It is an outrage that in our current system if for any reason you are unable to make your monthly mortgage payment, foreclosure can be initiated and you can lose all of your equity!
A lien represents a claim against property. Once attached, a lien freezes title in the name of the current owner of the liened property. There are two basic types of liens. The first is a Commercial Lien, such as a Mechanics Lien, which is filed by someone other than the lawful owner of the property, usually a vendor that has not been paid by the homeowner. The second is the Common Law Lien, which is placed on the property over which the lienor has lawful possession. Lawful possession is the most important element of a Common Law Lien. If you move out, the lien is no good.
To determine the amount of your Common Law Lien, there are three elements to consider. The first is equity. Equity means the actual amount of principal not including interest and insurance you have paid towards the property. Next we have improvements, meaning the actual dollar amount you have paid towards improving the value of the property. Finally, we have what some call life experience. Under common law, life experience has value. The idea is that you have lived, worked, played, laughed and have put yourself into the property so the property owes you as a result. There is no known formula for figuring life experience; however, a common figure used by many people is $3,000.00 dollars a year for every year you have lived in the house. Under no circumstances should the total amount of your lien exceed the general market value of the home, or you could be inviting an unnecessary legal challenge to your lien.
A Common Law Lien does not automatically prevent foreclosure; however, it could because the bank now has to sell the house for enough to pay your lien off first, as it is superior to the bank lien, and still have enough to cover the bank note. In this market the presence of a Common Law Lien on the property is very often enough to get the bank to work with you and not foreclose on the home.