A lien is a legal claim or encumbrance placed on an asset, typically used as collateral, to secure the repayment of a debt or obligation.

It grants the lien holder (e.g., a lender or creditor) the right to take possession of or sell the asset if the borrower defaults on the agreed terms. Liens can be voluntary, such as a mortgage on a property, or involuntary, such as a tax lien imposed by a government authority. Some are recorded in public records to establish priority over other claims on the asset. Proper management and clearance of liens are essential for maintaining clear title to assets and ensuring smooth financial transactions.

When creating or adding a lien, that lien can be in various status states, only ACTIVE however is considered during LTV calculations

Lien Status

Value	Description
ACTIVE	The lien is currently in effect, meaning the creditor has a legal claim on the asset until the debt is repaid or the obligation is fulfilled.
LAPSED	The lien is no longer enforceable due to expiration of a statutory time limit or failure to meet legal requirements, though it may still appear on records.
RELEASED	The lien has been formally removed, typically after the debt is fully repaid or the obligation is satisfied, freeing the asset from the creditor's claim.
TERMINATED	The lien has been canceled or voided, often due to legal action, dispute resolution, or mutual agreement between the parties involved.