Menu
Home>Levelset Community>Legal Help>Previous loan on property

Previous loan on property

Colorado

I'm a diesel mechanic and will be filing a mechanic's lien on a semi truck. If the owner still owes on his loan for the truck, do I assume that debt along with the truck?

1 reply

Sep 3, 2019
Liens for the repair or storage of vehicles are set forth by Colorado Revised Statutes § 38-20-101, et seq. Which govern liens on personal property. The only lien in that section that specifically sets forth it priority as related to other encumbrances is a "molder's lien." The priority is not specifically defined with respect to a mechanics/garagekeeper's lien. There are, however, procedures set forth for the foreclosure of the lien and sale of the underlying property. A court action must be initiated and a judgment obtained prior to sale of the property. But, the property must be sold (unless abandoned), although the lien holder may be the purchaser of the property. Once the property is sold, the lien holder is entitled to recover the amount due, plus limited storage and keeping fees, and potentially attorney fees. The remainder of the money obtained from the sale, however, must be given to the original property owner. Generally, all interested parties, like previous lien holders, would be necessary parties in a foreclosure action. And since the usual rule is that first in time equals first in right, a previous lien holder would recover the value of their lien prior to the subsequent lien holders being paid for their claim.
0 people found this helpful
Helpful