Louisiana situation guide · Updated November 2026

Wholesaling Houses With Liens in Louisiana

Wholesaling houses with liens in Louisiana means contracting to buy a New Orleans-area home that carries recorded claims against it, then assigning that contract to a buyer. The claims are paid out of the sale price at closing. Since Act 807 of 2026 (reported as effective August 1, 2026; confirm on legis.la.gov), a one-to-four unit wholesaler must also give written disclosures. Our legality guide covers the basics.

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The short answer

Can you wholesale a house with liens in Louisiana?

Yes, in most cases. You contract with the owner, the title company pays recorded liens from the proceeds, and your buyer closes on clean title, if you follow Act 807. A title attorney or notary should confirm every payoff before you promise the seller a net amount.

Louisiana is a civil-law state, so a lien is often called a privilege. A contractor who was never paid can record a privilege against the house. A creditor with a court judgment can record that judgment in the parish mortgage records. A bank holds a mortgage. Each shows up in a title search and needs payment or release before a buyer gets clear title. Our mechanic’s lien guide and judgment lien guide explain the common types.

The wholesaler’s job is to price the lien into the offer. If the owner is worth $200,000 on paper but owes $60,000 in claims, the real equity is smaller than it looks. Order a title search early and use the MAO calculator. Never promise the seller more than the title company can deliver after payoffs.

Houses With Liens in Louisiana at a glance

Lien types you will meet	Mortgages, contractor privileges, judgments, tax claims
Where they are recorded	Parish clerk of court mortgage and conveyance records
Who pays them off	The closing agent, from the seller proceeds
New statute	Act 807 of 2026, one-to-four unit homes
Seller can back out	For at least five calendar days
Escrowed deposit	One percent of the price or more

The opportunity

Why lien-burdened houses are an opening in New Orleans

Orleans Parish has plenty of older homes with deferred repairs, past renovation jobs and years of unpaid bills. Gentilly, the 7th Ward, Central City and New Orleans East have long drawn investors. Some owners sit on a house because they think the liens make it unsellable. Flood and insurance costs also shape what a buyer will pay, so check current numbers.

Owners who feel stuck

See how we approach negotiating with motivated sellers.

Negotiable payoffs

Some creditors accept less than the full balance when they see a closing date. Ask for a written payoff statement first.

Cleaner title for buyers

Buyers need clear title to finance, and a title policy depends on it.

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Lead sources

Where to find lien leads in Orleans Parish and nearby

Parish clerk records. Recorded judgments and privileges are searchable by owner name. Our title search guide shows the steps.
Code enforcement lists. Blight and cleanup liens often follow code violation leads.
Tax delinquent owners. Unpaid property tax is a claim of its own. Review the tax delinquent list guide.
Contractor disputes. Owners who stopped a renovation midway may have unpaid builders.
Direct mail and calls. Letters to owners with recorded judgments work well. See direct mail for wholesalers.

Your exit

Who buys houses with liens in Louisiana

Rehab investors and small landlords buy these homes once the title is clear. Show them price plus repairs up front. Use the ARV calculator to back up the resale value.

Use an investor-friendly title company for payoffs. If a claim cannot be released, the deal may need a quiet title action instead.

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Step by step

How to start wholesaling houses with liens in Louisiana

Pull the title. Search the parish records for mortgages, judgments and privileges before you quote a price.
Total the claims. List each amount, who holds it and whether a payoff letter is possible.
Run the numbers. Use the ARV calculator and the MAO calculator, then subtract the payoffs.
Hand over the notices. Give the Act 807 disclosures and the cancellation form before anyone signs.
Sign with the notice. Place the statutory cancellation notice next to the seller signature and note the deadline.
Fund the deposit. Put at least 1% of the price in escrow in Louisiana.
Close with a title agent. Use an investor-friendly title company so payoffs and releases are handled at the table.

Your checklist for wholesaling Houses With Liens in Louisiana

Order a title search before you make an offer.
Get written payoff statements for each claim.
Give each Act 807 disclosure before the seller signs.
Never record anything against the seller’s title yourself.
Ask a Louisiana attorney to review the contract.

A Louisiana example: a Gentilly owner with unpaid claims

Contract price	$118,000
Contractor privilege	$9,500
Judgment	$6,200
Existing mortgage	$71,000
Assignment fee	$12,000
Seller’s cash at closing	About $31,300

This is a worked example with illustrative numbers. A Gentilly owner stopped a kitchen job when the contractor and the owner disagreed, and a privilege was recorded for $9,500. A card creditor also recorded a $6,200 judgment.

You agreed on $118,000 after the title search. Before signing, you wrote out your plan to assign the contract, added the LREC form and placed $1,180 in escrow. No one cancelled in the five days.

A rehab buyer paid a $12,000 assignment fee. The closing agent paid the mortgage, the privilege and the judgment from the proceeds, and the owner walked away with about $31,300.

Louisiana rules to know

Act 807, privileges and what you may not record

Louisiana’s wholesaling statute, Act 807 of 2026 (HB 468), enacts R.S. 37:1431(35)-(37) and R.S. 37:1448.5 for one-to-four unit residential property. Read the current text. As the Act reads, you must disclose your intent to assign for a higher price, tell the seller to seek legal advice, and offer a cancellation right of at least five calendar days. It also bars a wholesaler from recording a lien, privilege or other encumbrance, or otherwise clouding title.

That bar matters here, because liens are the whole topic. You are paying off other people’s claims, not creating your own. A violation can make the contract voidable by the seller and can bring a civil penalty of up to $5,000 per violation. Broker-license rules can also apply, so read our license guide and attorney guide.

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Mentorship students bring us their payoff sheets and we help them decide if the deal still works.

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FAQ

Houses With Liens in Louisiana: common questions

Is wholesaling houses with liens in Louisiana legal?

It can be, if you follow Act 807 for one-to-four unit homes and the license rules. You contract with the owner, disclose in writing, and let the closing agent pay recorded claims from the proceeds. Check the current text and talk to a Louisiana attorney before you sign.

What is a privilege on a Louisiana house?

A privilege is the Louisiana civil-law word for a type of lien, such as a claim recorded by an unpaid contractor. It shows up in the parish records and generally has to be paid or released before a buyer gets clean title. A title search will list it.

Who pays the liens at closing?

The closing agent normally pays recorded claims from the seller’s proceeds and records the releases. The wholesaler’s fee comes from the buyer side. If the price does not cover all claims, the seller may need to bring cash or the deal may not work.

Can I record a memorandum of my contract?

Be careful. Act 807 bars a wholesaler from recording a lien or encumbrance or clouding title. Whether recording a memorandum of the contract is allowed is a question for a Louisiana attorney. Check the current text before you record anything.

How much deposit does a wholesaling contract need?

As the Act reads, each wholesaling contract needs a deposit of at least 1% of the purchase price, held in escrow in Louisiana or in the seller’s account. If the seller cancels within the window, the deposit comes back to you. Check current text.