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Lien
When a piece of property is made security for a debt a "lien" is said to have been placed on the asset in question. In the event of a default situation in which the debtor does not make payments or is rendered incapable of making payments, the property can be seized by the creditor and sold for the purposes of resolving the obligation.
A typical example of a lien is actually a simple home mortgage. The home purchased serves as security for the mortgage, which is a loan secured by the homeowner to buy the property. If the homeowner defaults on the mortgage, the lender can seize the home and sell it to resolve the debt.
A situation in which a lien is seized would be considered a negative financial event on a par with a bankruptcy, an instance of default, or a foreclosure and would have a detrimental effect on the individual's credit rating.
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