What is a "broker's lien"?

A broker's lien is a legal claim that allows a real estate broker to secure payment for the services they have provided in a transaction. This means that if a broker has not been paid for their services, they can file a lien against the property involved in the sale or lease to protect their right to be compensated.

This mechanism ensures that brokers are compensated for their efforts, which could include services such as marketing the property, facilitating negotiations, and providing guidance throughout the transaction process. By placing a claim on the property, the broker has a legal right that can be enforced if the client fails to fulfill their payment obligations.

In contrast, ownership of a property pertains to legal title and rights to the property, which does not relate to a broker's lien. A type of ownership transfer document refers to documents such as deeds that convey property interests, while a financial agreement with clients generally refers to contracts outlining terms of service rather than securing payment through a lien. Thus, identifying the broker's lien as a means to ensure payment accurately captures its function and importance within real estate transactions.