A-4 Liens and Encumbrances Flashcards
A blanket mortgage:
A. usually has a release clause
B. covers more than one parcel of real estate
C. covers both personal and real property
D. both A and B
D - usually has a release clause and covers more than one parcel of real estate
Which of the following is not a type of real estate mortgage? A. chattel mortgage B. deed of trust C. V.A. mortgage D. conventional mortgage
A - chattel mortgage
Lis Pendens is: A. a type of special assessment levied under the tax laws B. an intermediate license status C. A notice of pending court action D. a pending contract
C - a notice of pending court action
The following statements are true Except:
A. an attachment on property prevents the owner from conveying marketable title
B. an attachment is a lien created for a specific purpose
C. an attachment and a judgment are the same in every respect
D. both an execution and an attachment are authorized by court
C - an attachment and a judgment are the same in every respect
A mechanic's lien, once filed, is a valid lien on the subject property for how long? A. 90 days B. 60 days C. 6 months D. 1 year
C - 6 months
Work on a new dwelling was started on July 1. On August 1, the builder placed on record a mortgage. On September 1, work was completed and on October 25, the general contractor, not having been paid, files a mechanic's lien. Said lien has an effective date as of: A. July 1 B. August 1 C. September 1 D. October 25
A - July 1
Of the following, which best describes a second mortgage?
A. one always made by a seller
B. one of equal standing with the first mortgage on the same property
C. A junior lien on real estate
D. None of these
C - a junior lien on real estate
The act of extinguishing a debt by regular payments is: A. depreciation B. amortization C. prepayments D. acceleration
B - amortization
What clause in a mortgage or trust deed calls for lender's action when the lender's claims have been nullified? A. alienation clause B. substitution clause C. defeasance clause D. acceleration clause
C - defeasance clause
Payments on a Deed of Trust" are due the: A. Trustor B. Trustee C. Beneficiary D. Mortgagee
C - beneficiary
A defeasance clause is in a mortgage for the protection of the: A. lender B. borrower C. seller D. broker
B - borrower
What is the borrowing instrument that permits additional sums of money to be loaned by the same security device? A. subordination clause B. partial advance C. obligatory advances D. open end note and mortgage
D - open end note and mortgage
Which of the following is a security instrument in a real estate transaction? A. Note B. Trust deed C. easement D. estoppel
B - Trust deed
When the title holder is in default and a court is asked to enforce the lender's lien, the action is called: A. Lis Pendens B. foreclosure C. attachment D. encroachment
B - foreclosure
Who places deed restrictions on real estate? A. zoning board B. city commission C. grantor D. state ordinance
C - grantor
The primary difference in buying property subject to the mortgage instead of assumption of the mortgage is in: A. the quality of title conveyed B. the obligation of the mortgagee C. the obligation of the vendee D. the time for foreclosure
C - the obligation of the vendee
The priority of a lien is, in the absence of fraud, created as of the date it was: A. Signed B. Acknowledged C. recorded D. certified
C - recorded
In a blanket mortgage, which special clause would you most likely find? A. acceleration B. release C. Alienation D. subrogation
B - release
Which of the following relates to a mechanic's lien? A. statute of limitations B. recordation is required C. A statutory lien D. All of the above
D - all of the above
An encumbrance is anything that burdens: A. possession of property B. title to property C. zoning ordinances D. Police power of the state
B - title to property
A trust deed may be released from the records by: A. A title report B. a satisfaction piece C. recording the note D. recording the reconveyance
D - recording the reconveyance
If a trust deed contained a clause providing that the indebtedness was to be paid in full if the property was sold, it would be said that:
A. the trust deed has an acceleration clause
B. the trust deed had been subordinated
C. the trust deed contains an alienation clause
D. the trust deed was a most unusual type
C - the trust deed contains an alienation clause
Which of the following could file a mechanic's lien on a building being constructed? A. construction superintendent B. building superintendent C. lumber supplier D. none of these
C - lumber supplier
The type of mortgage where the lender pays the borrower based on the equity of the home is called: A. reverse annuity B. blanket mortgage C. package mortgage D. budget plan
A - reverse annuity
A monetary judgement by the court is:
A. an involuntary lien on the personalty and realty of the subject debtor
B. a voluntary lien on the personalty and realty of the subject
C. an involuntary lien against the realty only of the subject debtor
D. a voluntary lien against the personalty only of the subject debtor
A - an involuntary lien on the personalty and realty of the subject debtor
A signed release to substitute a new mortgagor for the original mortgagor is called: A. a novation B. a mortgage reduction certificate C. an assumption D. an estoppel certificate
A - a novation
An estoppel certificate primarily benefits:
A. the mortgagor
B. the mortgagee
C. the new buyer of the property
D. the investor who purchases the note and mortgage
D - the investor who purchases the note and mortgage
A lender agrees to reduce the interest rate on a loan but specifies in the agreement with the borrower that the lender shall receive 2% of all gross income from the property on which the loan was placed. This is an example of a: A. Package loan B. Participation loan C. Subrogation loan D. subordination loan
B - participation loan
Deed restrictions are placed on real property to:
A. force conformity to building codes
B. limit the use of the subject property by the grantee
C. force conformity to city ordinances
D. carry out the role of the planning commission
B - limit the use of the subject property by the grantee
The difference between the actual value of a property and the total amount of liens against the property would be: A. the sale price B. the owner's equity C. the taxable value D. the assessed value
B - the owner’s equity
A reduction certificate is appropriately used in which of the following situations? A. Sale of a note and mortgage B. assumption of a mortgage C. foreclosure of a mortgage D. default in a first mortgage
B - assumption of a mortgage
Arizona State Law provides for which of the following in regards to a mechanic’s lien?
A. extension of time for filing the lien by agreement
B. assignment of the lien
C. filing within 60 days for the original contractor
D. priority over mortgages and other liens, including property tax liens
B - assignment of the lien
A document which requires verification and recordation for it to have validity is a: A. contract of sale B. Lease on a building C. bill of sale D. mechanic's lien
D - mechanic’s lien
Which of the following written instruments normally accompanies a mortgage? 1. a note, 2. a deed A. 1 only B. 2 only C. both 1 and 2 D. neither 1 or 2
A - 1 only (a note)
In states allowing a trust deed, which of the following is not true?
A. a trust deed serves as security for a debt
B. a trust deed substitutes for the first mortgage
C. a trust deed conveys legal title to the trustee
D. a trust deed conveys legal title to the trustor
D - a trust deed conveys legal title to the trustor
A buyer assuming and agreeing to pay a mortgage:
A. becomes personally liable for the debt
B. May be held for the deficiency between the foreclosure price and the outstanding mortgage balance
C. Usually must be approved by the lender
D. All of the above
D - all of the above
To pledge something as collateral as in a mortgage is best defined as: A. pawning B. Hypothecation C. Impoundment D. All of the above
B - Hypothecation
A trust deed is signed by the: A. trustor B. trustee C. beneficiary D. trustee and beneficiary
A - trustor
If a lender releases an original borrower from his liability for a mortgage, the substitution must be evidenced by an agreement called a/an: A. accelration clause B. power of sale clause C. Satisfaction piece D. Novation
D - novation
Which of the following is in the proper order of occurrence? A. judgement, attachment, lis pendens B. judgement, lis pendens, attachment C. execution, attachment, judgement D. lis pendens, judgement, execution
D - lis pendens, judgement, execution
All of the liense listed below are voluntary EXCEPT a/an: A. mortgage B. attachment C. seller carryback D. deed of trust
B - attachment
When a person wishes to enforce a judgement they would exercise: A. law suit B. right of redemption C. notice of completion D. writ of execution
D - writ of execution
If a property owner would like to eliminate a nuisance, which of the following actions would apply? A. easement B. license C. garnishment D. abatement
D - abatement
A negative amortization loan would be a loan:
A. where the loan balance declines each month
B. with principal payments only
C. with private mortgage insurance
D. where principal balance increases
D - where principal balance increases
