What legal claim allows a party to hold another's property until a debt is settled?

The legal claim that allows a party to hold another's property until a debt is settled is known as a claim of lien. A lien is a legal right or interest that a lender or service provider has in the borrower's property, granted until the debt obligation is satisfied. In real estate, this typically occurs when a contractor, lender, or governmental body places a claim on a property to secure payment for services rendered, loans, or taxes owed.

When a lien is in place, the property cannot be sold or refinanced without addressing outstanding debts, ensuring that the lienholder is paid. This mechanism protects creditors, as it creates a formal claim against the property, thus providing a way to enforce the collection of outstanding debts.

The other options are related but do not specifically denote the ability to hold property until a debt is settled. An encumbrance, for instance, refers to any claim, lien, charge, or liability attached to and binding real property but does not inherently give the right to hold the property. A judgment is a court's decision, often leading to the ability to secure a lien but not itself a direct claim of property. A debt claim lacks the specificity of applying directly to property. Therefore, the claim of lien is the precise