Free and clear
Encyclopedia
In property law
, the term free and clear refers to ownership without legal encumbrances, such as a lien
or mortgage. So, for example: a person owns his house free and clear if he has paid off the mortgage and no creditor
has filed a lien against it.
Property law
Property law is the area of law that governs the various forms of ownership in real property and in personal property, within the common law legal system. In the civil law system, there is a division between movable and immovable property...
, the term free and clear refers to ownership without legal encumbrances, such as a lien
Lien
In law, a lien is a form of security interest granted over an item of property to secure the payment of a debt or performance of some other obligation...
or mortgage. So, for example: a person owns his house free and clear if he has paid off the mortgage and no creditor
Creditor
A creditor is a party that has a claim to the services of a second party. It is a person or institution to whom money is owed. The first party, in general, has provided some property or service to the second party under the assumption that the second party will return an equivalent property or...
has filed a lien against it.