Unperfected Lien - Explained
What is an Unperfected Lien?
Written by Jason Gordon
Updated at April 6th, 2023
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What is an Unperfected Lien?
An unperfected lien is a lien that was not filed legally or correctly by a lender. This is important, as a perfected lien is accorded priority over an unperfected lien.
There are many factors responsible for unperfected liens, these include:
- Incorrect information in the lien filed
- Not filing the lien with a correct legal authority.
- Negligence in recording finance statement for the property.
- Failure to detect that there is an existing lien on the property for which the lien of filed.
A creditor that has a perfected lien is given priority over one who has an unperfected lien.
Back To: COMMERCIAL LAW: CONTRACTS, PAYMENTS, SECURITY INTERESTS, & BANKRUPTCY
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