§ 8.01-480.Prior security interest on property levied on.

A debtor rarely owns property free and clear. Cars, equipment, and other tangible goods often carry a lender’s security interest ahead of any judgment creditor’s claim. Section 8.01-480 makes sure that reality does not put the property beyond an execution creditor’s reach — it can still be levied on, even if a prior security interest attaches to it or the debtor holds only an equitable interest in it.

What happens next depends on whether the security interest is already due and payable. If it is, the officer may sell the property free of that interest, paying the secured lender first out of the proceeds and directing whatever is left toward the fieri facias. But that shortcut comes with a real notice obligation: the judgment creditor must send certified mail to every secured party of record — checked against filings with the State Corporation Commission, the Department of Motor Vehicles, the Department of Wildlife Resources, or the clerk’s office in any locality where the debtor has lived in the past year — plus anyone else the creditor knows about. The officer conducting the sale gets certification of that notice and announces that the sale remains subject to any prior security interest belonging to someone who was not properly notified.

If the security interest has not yet matured at the time of sale, there is no shortcut at all: the officer must sell the property subject to that interest, leaving the buyer to take it with the lender’s claim still attached.