how voluntary liens are applied
voluntary liens are often used for mortgages to purchase real estate but they can also be used in many other types of financing such as car loans secured personal loans business loans credit agreements and even rent to own appliance transactions typically the physical property that the borrower is purchasing acts as collateral under the lien however a voluntary lien can also be placed on other property that the borrower already owns if the borrower agrees to it for instance a lien could be placed on a valuable painting if the borrower uses it as collateral for a cash advance to fund another purchase or a homeowner who has paid off their mortgage and owns their house outright might need more cash and allow a lien on it in order to obtain a home equity line of credit heloc just as with a mortgage for a home purchase the house would serve as collateral finally a business could have a voluntary lien on it if the business owner takes out a line of credit to cover operating expenses or other costs in this case the lender would not take possession of the business if the borrower defaults but instead receive a security interest in it voluntary liens vs involuntary liensan involuntary lien or a nonconsensual lien is one that is imposed on you instead of one you consent to two types of involuntary liens are statutory liens and judgement liens 