Can a Lien Be Put on a House if My Wife Owes a Debt?

Calculating and resolving debt can be an unsettling process. Worrying about a lien being placed on your home compounds the issue. This process can be even more confusing if only one spouse owes the debt. Educating yourself on your rights will help you know what to do if creditors come knocking.

Definition

A lien is a claim someone can make to obtain possession of your property if you owe that person or organization money. The claim becomes legally enforceable -- known as a "judgment lien -- if you are sued for the money and a court determines you are responsible for the debt. You are unable to regain ownership until the debt is settled. If you own real estate, it's first type of property a lien is placed against.

Ownership

Much depends on whose name is on the home's mortgage and the deed. If your wife's name does not appear on the deed or mortgage, a lien will not be placed on your home. This scenario assumes that your name is not attached to her debt, such as in a joint credit line. If your wife is a co-owner in any capacity, it is possible a court will place a judgment lien on a portion of the house. Technically, your spouse owns 50 percent of the home, so a creditor could ask for a lien against half the house.

Protection

Certain things are in place to protect you, especially if the debt is only in your wife's name. In most cases, the courts will not sell your house to fulfill the debt. However, if the lien is still in place when you sell the home, the creditor will be able to collect on your wife's portion of the sale. Most states have homestead laws, which allow you to protect a certain portion of your home's equity. If your spouse passes away, the debt is nontransferable, so the lien is lifted.

Lien Settlement

To avoid execution, you or your wife must pay the balance of the debt. However, even if a judgment lien is placed against your property, it can still be lifted. If your wife fulfills her debt, the creditor will go through the process of lifting the lien. Be aware that a lien, paid or unpaid, will show up on a credit report, and can harm a credit score.