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Definition of Lien

A lien is a legal claim against another individual's property as a security for a debt. The ownership of the property is not transferred to the lien holder, but if the property is sold the lien holder has the right to have the debt paid prior to the sale to a third party.

Under some conditions if a claimant is awarded a personal injury settlement after an injury case certain creditors may put a lien on the personal injury award. For instance, in some states a hospital or doctor who is owed money may place a lien on the award which means the court has decided they are entitled to a portion of the final settlement. Some states also allow a type of lien called "balance billing". If your state allows this process it means that even if a doctor or hospital has already been paid by you or your health insurance company, the medical provider may claim they should receive additional money because your treatment was injury related.

Liens can be complicated and it can be tough to get rid of certain liens. If you have hired a personal injury lawyer they can help you with lien issues after a personal injury settlement is awarded.

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