> Otherwise it seems to me like this is a ripe opportunity for scams. Buy house, have contractors refurbish it, sell it for a much higher value, then the contractors register their debts and now the new buyers or their insurance is on the hook for the refurbishment.

This is called ‘fraud’, it is already illegal.

Mechanic’s liens are good and necessary for customers like the current US President who fail to pay their contractors.

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sfn42 a day ago | parent [-]

Yeah I don't have a problem with liens, I have a problem with unregistered liens. There needs to be a system for registering and searching liens, it needs to be publicly accessible and the lien needs to be registered before it's valid. In order to register a lien on a car you need the owner's signature, that can't work when the owner has changed. Mechanic needs to get the contract signed then report the new lien to wherever it should be reported, and once that's all in order they can start working on the vehicle.

If they try to register their lien once the owner of the vehicle has changed, it can not be accepted. You can't secure debt with a vehicle you no longer own. The lender needs to make sure the person owns the car and register the debt while they still own the car. And if they sell the car then they have money to pay the debt, and since they no longer own the car then their debt is no longer secured so that should trigger a requirement to pay the debt per the loan contract. Debt should be owned by people not objects.

The whole concept of debt that's attached to objects is silly. It can make sense in certain situations like a housing association that's taking up a shared loan and paying it down as part of shared monthly expenses, but for a car repair or similar it makes no sense. The person who takes the debt is responsible for the debt. If they sell the car then they pay the debt with the money from the sale, if the sale doesn't cover the debt then they still owe the rest.

It does not need to be any more complicated than this. In order for anyone to take over responsibility for debt in relation to a purchase, there needs to be explicit written and signed consent. So - I can buy a house including some debt if I know and agree to it, but I can't unwittingly buy a landmine. If the owner fails to resolve their debts when they sell that should be their problem not the buyer's. It's up to the bank to collect their debts from the person they have a contract with.

	▲	1-more 8 hours ago \| parent [-]
		> If they try to register their lien once the owner of the vehicle has changed, it can not be accepted. This is true in practice with houses, not in theory. Here's an example (differs by jurisdiction) of how the deadlines work for filing a lien: https://www.levelset.com/payment-help/question/can-we-lien-a.... The title search should include "are the sellers the defendants in a lawsuit wherein if they lose, the judgment results in a lien on the property." We actually went under contract on a house where the owner's name matched someone in bankruptcy and triggered this. We knew the guys were different (ages, addresses) but our mortgage lender needed the title company to figure out their mistake first. So the lien attaching to a house that sells in the meantime is a really extraordinary circumstance: closings usually take 30 days so what are the odds that something gets filed in that meantime without already being underway? If the lien does attach to the house, then the buyer would have a tort against the seller for putting them on the hook, but the mechanic would have a backstop for getting paid in the form of the lien. The buyer could get a judgment against the seller. But that'll all be handled by the title insurance if it ever comes to that. > The person who takes the debt is responsible for the debt. If they sell the car then they pay the debt with the money from the sale, if the sale doesn't cover the debt then they still owe the rest. This is how it really works in practice. The mortgage company won't let you buy the house with the liens still attached. The debts will get paid out of the purchase price of the house. Who gets paid what out of the sale price is already determined before the actual closing date, and the mortgage company writes separate checks to everyone who needs to get paid (I think). The insurance is there in case something very out of the ordinary happens. Even the cost of paying someone to figure out who gets what is part of that insurance policy (again, I think). > If the owner fails to resolve their debts when they sell that should be their problem not the buyer's. It effectively is. The title search before the closing reveals all of this and pauses the sales process. Nothing proceeds until they come up with a plan to pay it off. The insurance is only for extraordinary circumstances where someone messed up the recording of the lien. > There needs to be a system for registering and searching liens, it needs to be publicly accessible and the lien needs to be registered before it's valid. This would be the best. I'd love it if it were federal so you just had to search one thing. Bankruptcy is federal, so why not this? Even better: if the system could record the house going under contract. You're a roofer who's been lazy suing somebody. Every Monday you upload the CSV of addresses that owe you money. One of those days, you see "this house is now under contract and you have 5 days until the window to register lawsuits against the sellers closes" You call your lawyer and tell them to start the lawsuit for the unpaid debt. Sellers and buyers get notified that the title isn't clear and there's a suit worth $X to work out. This then produces the problem of people monitoring every address in their town and threatening the parties to the sale with a baseless lawsuit in order to pause the sale. You may have to bring back corporal punishment to stop such individuals. Hmm. Much to consider.