Question

If you file a lien, who do you get paid before in case of foreclosure?

1) The homeowner
2) The bank
3) The contractor
4) The government

Answer 1

In the hierarchy of liens, payment priority usually goes first to the government, then the bank, followed by contractors, and lastly to the homeowner after foreclosure.

Step-by-step explanation:

When you file a lien on a property due to unpaid debt, the order in which parties get paid before a foreclosure can take place is determined by the hierarchy of liens. Typically, this hierarchy prioritizes payment to 1) the government for tax liens, 2) the bank holding the first mortgage, 3) junior lien holders (which could include secondary mortgages, home equity lines of credit, and in some cases, contractors), and finally 4) the homeowner, if there are any remaining funds after satisfying all liens. It is important to note that a contractor who files a mechanic's lien for unpaid work would get paid after the bank and before the homeowner but may still be subordinate to earlier liens such as tax liens by the government.