What is a settlement lien?

A lien is a court order placed on a person’s personal property to pay debts owed to a third person or entity. In a situation where you will be receiving a claim settlement, the personal property in question is the settlement amount. The third party who is owed money can file a lawsuit asking for an amount from your settlement to pay what money you owe them. For example, liens can be pursued by creditors seeking payments for outstanding bills.