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Don Jacobs
Don Jacobs
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Liens and automobile accidents. Who can have them? What do they mean?

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What is a lien? A lien is actually a very common term, and many people in America currently have liens and might not even realize it. A lien is the legal possession of property by another until the debtor completes his or her legal duty to repay the person in possession of the property. It may sound complicated, but liens are everyday occurrences. A very common lien is a mortgage. If you have a mortgage on your home the bank has a legal ownership of your property, although you still have a right to live in your house. However, if you do not pay your mortgage the bank can take the property back. This is because they have a legal right to the property. This legal right extinguishes when you pay off the mortgage.

So a lien is basically like a reservation or a hold on property. There are two kinds of liens, particular and general liens. When a bank or lending organization claims the right to property based on money or labor for the particular property, this is a particular lien. These can arise from express contract, implied contract, or a legal relation. A general lien can arise through agreement of the parties, general use, or particular use.

Liens can be structured differently depending on the situation. The creditor may have a legal claim against the asset but allow the debtor to have possession, or in some cases the creditor may retain possession of the asset until the debt is paid off.

If you are injured in an automobile accident, one of the first things any hospital or doctor will ask is how you intend to pay for the care. If you are one of the dwindling number of Americans who still has health insurance, you may elect to use this method of payment. Many people have medical coverage for accident related injuries contained within their own auto insurance policy. Some states, like Oregon, require this in every consumer policy. If you have this coverage, it must be used first before you turn to your private health insurance. This coverage, commonly called "PIP" or "Personal Injury Protection", will pay for all of your care up to a certain date or a certain amount, whichever comes first. When this coverage is exhausted, then you can start to use your private health insurance to pay your bills. Whether you use your PIP coverage or your private health care, you will soon learn you have an obligation to repay your insurance company out of any proceeds you recover from the person who caused your injury. In fact, your insurance company will assert a lien against your case. This is an example of a particular lien. Although these liens can be negotiated or even removed completely under certain circumstances, the failure to resolve the liens when you settle can subject you to a lawsuit brought against you by your insurance company. If you find yourself the victim of an auto accident, make sure properly access your insurance coverages and protect yourself from any liens when the case settles. If you find yourself in over your head with the legal details, consult an attorney experienced in this area.