You can sell a property with a lis pendens on it, but a conventional sale is extremely difficult until the notice is cleared. A lis pendens is a recorded notice that a lawsuit affecting the property is pending, and while it does not legally block a transfer, it drives off nearly every mortgage lender, title insurer, and ordinary buyer. In almost every case, the realistic choice is to resolve or remove the lis pendens first, or to sell at a significant discount to a cash buyer who understands litigation risk.
The notice itself is not a lien and does not take any ownership rights away from you. Its power is informational. Once it appears in the chain of title, anyone who buys afterward is legally presumed to know about the lawsuit and takes the property subject to whatever the court decides.1Legal Information Institute. Notice of Pendency If the plaintiff wins, the judgment binds the new owner the same way it would have bound you. A court could order the title transferred, impose a lien, or recognize an easement. The buyer could lose the property outright.
Why a Normal Sale Breaks Down
Three problems feed each other and shut down the usual market.
Title Insurance Becomes Unavailable
Title insurance protects buyers and lenders against ownership problems that surface after closing.2National Association of Insurance Commissioners. The Vitals on Title Insurance: What You Need to Know A lis pendens is the opposite of a hidden problem. It is a known, active dispute sitting on the record. Title companies will either refuse to issue a policy or write an exception specifically for the pending lawsuit, which defeats the point. A buyer whose policy excludes the lis pendens has no coverage for the biggest risk they are taking.
Mortgage Financing Dries Up
Lenders require a clean title insurance policy before funding a loan. No clean policy, no loan. A bank will not finance a purchase when a court might hand the collateral to someone else. That removes every buyer who needs a mortgage, which is almost all of them.
The Buyer Pool Shrinks to Bargain Hunters
Without financing, you are left with cash buyers, and cash buyers who knowingly accept lawsuit risk expect a steep discount. Properties carrying a lis pendens commonly sell at markdowns of 10 to 30 percent below market value, sometimes more, depending on how strong the underlying claim looks. The realistic buyers are often investors who specialize in distressed situations, and they negotiate hard.
How to Clear a Lis Pendens Before Selling
Getting the notice off the record is the cleanest path back to a normal sale. There are four main routes, and they can overlap.
Settle the Underlying Dispute
Negotiation is usually the fastest resolution. If you reach a settlement with the person who filed the lawsuit, they can record a release or withdrawal of the lis pendens with the county recorder’s office. Once that document is on record, the cloud lifts and the title is marketable again. The settlement itself might involve a payment, an easement, or other terms. The key is getting the plaintiff to voluntarily remove the notice. Most lis pendens situations end here, because both sides often prefer certainty to years of litigation.
File a Motion to Expunge
If settlement is off the table, you can ask the court to remove the lis pendens by filing a motion to expunge. The standard varies by state, but the general principle is consistent: the person who filed the lis pendens has to show that their underlying claim has probable validity, meaning it is more likely than not that they will win the real property claim. If they cannot meet that burden, the court orders the lis pendens expunged. Courts also grant expungement when the lawsuit does not actually involve a claim to the property’s title, for example when someone has filed over a pure money dispute that has no direct connection to the real estate.
Post a Bond
Even when the plaintiff’s claim has merit, a court may let you substitute a surety bond for the lis pendens. The judge sets the bond amount based on the potential damages at stake. Once the bond is in place, the plaintiff’s claim shifts from the property to the bond, so you can sell with clear title while the lawsuit continues. The bond guarantees the plaintiff will be paid if they win. It costs money, since a surety company charges a premium, but it can be worth it when the property’s value is well above the amount in dispute.
Win the Lawsuit
If the court rules for you on the underlying case, the lis pendens is terminated. This is the most thorough fix because it eliminates both the notice and the claim behind it. The downside is time. Litigation can run months or years, and you cannot sell on normal terms while you wait.
Selling Without Removing the Lis Pendens
If none of the clearing options work on your timeline, selling as-is is still legal. Here is what that actually looks like.
Your buyer will almost certainly be a cash investor who understands real estate litigation. They will demand full disclosure of the lawsuit and will price in the worst-case scenario. You are negotiating from a weak position. The buyer knows your alternatives are limited and that they are taking a real risk, because if the plaintiff wins, the buyer could lose the property or face a court-imposed lien or encumbrance.
Some sellers and buyers escrow a portion of the sale proceeds to cover the plaintiff’s potential claim. This does not remove the lis pendens, but it gives the buyer a cushion and can make the deal more palatable. The arrangement needs careful drafting by an attorney, and it does not eliminate the risk that a court order could still affect the buyer’s ownership.
A related approach sometimes works in the settlement context. The parties agree that the plaintiff will withdraw the lis pendens in exchange for securing their claim against the sale proceeds held in escrow. The property sells with clear title, the buyer gets clean ownership, and the plaintiff’s interests are protected by the escrowed funds instead of by the property. It is essentially a negotiated version of the bond approach, done by agreement rather than court order.
When the Lis Pendens Shouldn’t Be There
Because a lis pendens can effectively freeze a property’s marketability, some people file one as leverage in disputes that have little to do with the property’s title. Courts take that seriously, and you have remedies beyond expungement.
The most direct response is a slander of title claim. If a recorded document falsely clouds your title and causes financial harm, you can sue for damages. Recoverable damages typically include the lost value or impaired marketability of the property and the attorney fees spent removing the wrongful filing. Where intentional misconduct is involved, some states also allow punitive damages.
Courts can sanction parties who abuse the lis pendens process. If a judge finds the filing was made to harass rather than to protect a legitimate claim, the court may award attorney fees for the expungement motion and assess civil penalties. Depending on the state and the facts, the filer may also face claims for abuse of process or malicious prosecution.
A lis pendens is not something the filer can maintain indefinitely without consequence. Some states impose automatic expiration periods that require renewal, and property owners always have the right to challenge the filing in court. If you believe the lis pendens on your property is baseless, moving quickly to file a motion to expunge is the most effective response, because every day the notice sits on your title is a day you cannot sell on normal terms.
A Quick Note on What Supports a Valid Lis Pendens
Not every property-related lawsuit will support a lis pendens. The filer generally needs a claim that directly affects title or ownership, such as foreclosure, a buyer’s specific performance claim to force a sale, a divorce involving marital property, a partition action between co-owners, or a boundary or easement dispute.3Legal Information Institute. Lis Pendens A lawsuit that only seeks money damages from you, without claiming any right to the real estate itself, generally does not support a valid lis pendens, and that distinction is often the basis for a successful motion to expunge.