Glossary for Investors

First Lien

A lien is a claim or legal right of a creditor or lender to seize an asset if the borrower fails to pay off the contract. It serves to guarantee an underlying obligation, such as the repayment of a loan. The first lien has priority over all other secondary liens, or claims, on an asset. 

In real estate, the first lien is generally the first mortgage on a property. If the homeowner fails to pay their mortgage, the lien empowers the lender to take possession of the property in order to recoup the debt. 

More information on liens here.

Full Glossary