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Unit 10: Real Estate Taxes and Other Liens > Assessment > Flashcards

Assessment Flashcards

1
Q

Which lien affects all real and personal property of a debtor?

A

General

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2
Q

___ refers to the order in which liens will be paid if property is sold to satisfy a debt

A

Priority of liens

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3
Q

Special assessment is a lien on real estate made to secure payment for a(n)…

A

specific municipal improvement project

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4
Q

Judgement is classified as a(n) ___ lien.

A

General

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5
Q

Which of these liens would be generally given highest priority in disbursing funds from a foreclosure sale?
A) Mortgage dated last year
B) Mechanic’s lien for work started before the mortgage was made
C) Real estate taxes due
D) Judgment rendered yesterday

A

Real estate taxes due

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6
Q

Which of these taxes targets homeowners in particular?
A) Personal property tax
B) Sales tax
C) Real property tax
D) Luxury tax

A

Real property tax

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7
Q

A homeowner decided to add a family room onto his house. An electrician was hired to wire the room but has not been paid. The electrician has the right to record a notice of the ___ lien and to ___.

A

mechanic’s lien
file a court suit

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8
Q

What is the annual real estate tax on a property valued at $135,000 and assessed for tax purposes at $47,250 with an equalization factor of 125% when the tax rate is 2.5%?

A

$1,477

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9
Q

Which of these is a voluntary, specific lien?
A) IRS Tax lien
B) Mechanic’s lien
C) Mortgage lien
D) Special assessment

A

Mortgage lien

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10
Q

In 2 weeks, a general contractor will file a suit against a homeowner for nonpayment. The contractor just learned that the homeowner has listed the property for sale with a real estate broker. In this situation, what will the contractor’s attorney use to protect the contractor’s interest?

A

Lis pendens

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11
Q

Special assessment liens take ___ over mechanics’ liens

A

priority

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12
Q

Unpaid mortgage loan creates a(n) ___ on real estate.

A

lien

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13
Q

A(n) ___ lien would be available to a contractor.

A

Mechanics’

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14
Q

A person owns a primary residence and 2 apartment buildings. She pays property taxes on 2 of the 3 properties. The delinquent taxes will result in a lien on which property?

A

the property which she has not paid the taxes

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15
Q

General real estate taxes leveled for the operation of the government are called…

A

Ad valorem taxes

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16
Q

The equalization factor used in Illinois taxation is designated to correct ___ between the assessed values of similar parcels of land in various counties.

A

Discrepancies

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17
Q

A man owns a condo town house in Cook County and a weekend retreat in Sangamon County, both in Illinois. He also owns investment property in Montana. If one of his creditors sues him in a Cook County court and a judgment is issued against him and is recorded in both Cook and Sangamon counties, the judgement becomes a lien on which properties?

A

The properties in Cook and Sangamon counties

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18
Q

A man owns a condo town house in Cook County and a weekend retreat in Sangamon County, both in Illinois. He also owns investment property in Montana. If one of his creditors sues him in a Cook County court and a judgment is issued against him and is recorded in both Cook and Sangamon counties, the judgement becomes a lien on all of the properties EXCEPT…

A

the property in Montana

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19
Q

A successful bidder wins a. property at an annual tax sale. She may obtain a tax deed if the property is…

A

not redeemed within the redemption period

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20
Q

The first installment of the tax bill for all counties except Cook is due on…

A

June 1

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21
Q

A charge or claim against a person’s property to enforce the payment of money

A

Lien

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22
Q

A lien that is created intentionally by the property owner’s action

A

Voluntary lien

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23
Q

A lien created by law

A

Statutory lien

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24
Q

A lien created by a court judgment

A

Equitable lien

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25
Q

A lien that affects all of the real and personal property owned by a debtor

A

General lien

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26
Q

A lien that is secured by and only affects certain property of the debtor

A

Specific lien

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27
Q

The order in which claims against property will be satisfied

A

Priority

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28
Q

A written agreement between lienholders to change the priority of a lien

A

Subordination

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29
Q

Charges imposed by state and local governments to fund their functions and services

A

Taxes

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30
Q

A type of tax based on the assessment of a property’s value

A

Ad valorem

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31
Q

The official process of valuing real estate for tax purposes

A

Assessment

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32
Q

A device to achieve uniformity in statewide investments

A

Equalization factor

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33
Q

1/1,000 of a dollar, or $0.001

A

Mill

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34
Q

The right of a delinquent taxpayer to recover property before a tax sale

A

Equitable right of redemption

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35
Q

The right of a delinquent taxpayer to recover property after a tax sale

A

Statutory right of redemption

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36
Q

Taxes levied on specific properties that benefit from public improvement

A

Special assessments

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37
Q

A specific, involuntary lien that gives security to persons or companies who perform labor, or who furnish material to improve real property

A

Mechanics’ Lien

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38
Q

A court decree that establishes the amount owed by a debtor and provides for money to be awarded

A

Money judgment

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39
Q

A notice of a possible future lien based on a lawsuit

A

Lis pendens

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40
Q

A writ that permits a court to retain custody of a debtor’s property until the creditor’s lawsuit is concluded

A

Attachment

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41
Q

To reveal any recorded liens, a property buyer should require a(n) ___ before closing the real estate transaction.

A

Title search

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42
Q

A county assessor usually bases a property’s ___ on the sale prices of comparable propertyies

A

assessed value

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43
Q

Usually, a vote of the taxing district’s governing body is needed to impose a(n) ___.

A

Tax levy

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44
Q

In many states, when a purchaser at a tax sale receives the ___ the purchaser gains the right to take possession of the property.

A

Certificate of sale

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45
Q

A lien that is created intentionally by the property owner’s action, such as taking out a mortgage, is called a(n) ___.

A

Voluntary lien

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46
Q

The priority of a(n) ___ may be established as the date construction began or materials were first furnished

A

Mechanics’ lien

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47
Q

A court order against the property of another person that directs the sheriff to take control of a property is called a(n) ___.

A

Writ of attachment

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48
Q

When real property is sold to pay off a debt, the debtor should get a legal document called a(n) ___.

A

Satisfaction of judgment

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49
Q

Hospitals are an example of a property that is exempt from ___.

A

Taxation

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50
Q

When a large scale improvement project, such as sewer construction, is planned, it may be funded by creating a(n) ___.

A

Local improvement district

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51
Q

Mechanics’ Liens are…
Select all that apply:
A) General
B) Specific
C) Voluntary
D) Involuntary
E) Equitable
F) Statutory

A

Specific
Involuntary
Statutory

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52
Q

Mortgage liens are…
Select all that apply:
A) General
B) Specific
C) Voluntary
D) Involuntary
E) Equitable
F) Statutory

A

Specific
Voluntary
Equitable

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53
Q

Bail bonds are…
Select all that apply:
A) General
B) Specific
C) Voluntary
D) Involuntary
E) Equitable
F) Statutory

A

Specific
Voluntary
Statutory

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54
Q

Municipal Utility Liens are…
Select all that apply:
A) General
B) Specific
C) Voluntary
D) Involuntary
E) Equitable
F) Statutory

A

Specific
Involuntary
Equitable

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55
Q

Federal Estate Tax Liens are…
Select all that apply:
A) General
B) Specific
C) Voluntary
D) Involuntary
E) Equitable
F) Statutory

A

General
Involuntary
Statutory

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56
Q

Corporate franchise taxes are…
Select all that apply:
A) General
B) Specific
C) Voluntary
D) Involuntary
E) Equitable
F) Statutory

A

General
Involuntary
Statutory

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57
Q

State inheritance taxes are…
Select all that apply:
A) General
B) Specific
C) Voluntary
D) Involuntary
E) Equitable
F) Statutory

A

General
Involuntary
Statutory

58
Q

Judgements are…
Select all that apply:
A) General
B) Specific
C) Voluntary
D) Involuntary
E) Equitable
F) Statutory

A

General
Involuntary
Equitable

59
Q

Real property taxes are…
Select all that apply:
A) General
B) Specific
C) Voluntary
D) Involuntary
E) Equitable
F) Statutory

A

Specific
Involuntary
Statutory

60
Q

A(n) ___ lien may be classified as either statutory or equitable.

A

involuntary

61
Q

Voluntary liens are never ___.

A

statutory

62
Q

A charge or claim against a person’s property by a creditor, which is made to enforce the payment of money, is called a(n) ___.

A

Lien

63
Q

All encumbrances are liens. True or false?

A

False

64
Q

A(n) ___ is any charge or claim that attaches to real property and lessens its value or impairs its use, but does not prevent the transfer of the property.

A

encumbrance

65
Q

Both federal estate taxes and state inheritance taxes are ___, ___, and ___ liens.

A

1) general
2) statutory
3) involuntary

66
Q

A(n) ___ lien is created intentionally by the property owner’s actions, such as taking out a mortgage.

A

Voluntary

67
Q

A lien runs with….

A

the land

68
Q

Liens bind all successive ___.

A

owners

69
Q

A special assessment is always a(n) ___ and ___ lien.

A

Specific
Statutory

70
Q

A court’s decree that establishes the amount owed by a debtor is enforced by the creditor obtaining a(n) ___ directing the sheriff to seize and sell the debtor’s property.

A

writ of execution

71
Q

___ and ___ generally take priority over all other liens.

A

Real estate taxes
special assessments

72
Q

___ taxes are based on the value of the property being taxed and are specific, involuntary, statutory liens.

A

Ad valorem

73
Q

All liens are encumbrances. True or false?

A

True

74
Q

The presence of a lien on real property prevents the owner from conveying title to another party. True or false?

A

False

75
Q

The presence of a lien on real property does not prevent the owner from conveying title to another party. True or false?

A

True

76
Q

A taxing body determines the appropriate tax rate by dividing the total ___ needed for the coming fiscal year by the total ___ of all taxable real estate located within the taxing body’s jurisdiction.

A

Monies
Assessments

77
Q

A delinquent taxpayer may redeem property any time prior to a tax sale by exercising a(n) ___.

A

Equitable right of redemption

78
Q

___ liens are secured by specific property and affect only that particular property

A

Specific

79
Q

Generally in a court ordered sale, ___ is paid first.

A

Real estate taxes

80
Q

Which of these is a specific, voluntary lien?
a) decedents debts
b) internal revenue service liens
c) mortgage liens
d) corporate franchise liens

A

Mortgage

81
Q

The millage breakout for ad valorem taxes is library: 0.5; school: 1; school debt service: 0.5; community college: 1; vocational school: 0.5; and all others: 5. If a property is assessed at $165,000, how much is the tax bill?

A

$1,402.50

82
Q

Which is not a lien against real property?
a) mortgage
b) real estate tax
c) lis pendens
d) home improvement loan of a deceased property owner

A

Lis pendens

83
Q

A writ of execution permits law enforcement to ___ and ___ a debtor’s property.

A

Seize and sell

84
Q

In february, a homeowner contracted with a general contractor to have a basement storage space converted to a sauna, but never paid for the work. The homeowner stopped making mortgage payments in june. The owner is 2 years delinquent in property taxes to the county. If all of these creditors obtain judgments against the owner in november, what will be the priority of their liens from first to last?

A

1) county
2) contractor
3) mortgage

85
Q

A town wants to construct new concrete curbs in a residential neighborhood. How will the town most likely raise the money necessary for the improvement?

A

Special assessment

86
Q

A lien that does not have to be recorded to be effective is the ___.

A

real estate tax lien

87
Q

The market value of an undeveloped parcel is $40,000. Its assessed value is 40% of market value, and properties in its county are subject to an equalization factor of 1.50. If the tax rate is $4 per $100, what is the amount of the tax owed on the property?

A

$960

88
Q

To give notice of a potential claim against property and to establish priority, a creditor may file a(n) ___.

A

Lis pendens

89
Q

A homeowner considered having a new garage built and talked about the project with a contractor. In april, while the homeowner was on vacation, the contractor began bulding the garage according to the homeowner’s specifications. Work was complete by the end of May. In June, the homeowner returned from vacation and refused to pay for the garage. The contractor decided to file a mechanic’s lien in July. Is the contractor entitled to a lien? Why or why not?

A

No, because there was no express or implied contract between the homeowner and contractor.

90
Q

A buyer should insist on a(n) ___ before closing a real estate transaction so that any recorded liens are revealed.

A

Title search

91
Q

___ refers to the order in which claims against the property will be satisfied.`

A

Priority of liens

92
Q

Liens generally take priority from the…

A

Date they are recorded in public records

93
Q

A mansion is ordered sold by the court to satisfy the owner’s debts. The property is subject to a $50,000 judgment lien, incurred as a result of the mechanic’s lien suit. Principal and interest totaling $295,000 remains to be paid on the mansion’s mortgage. This year’s unpaid real estate taxes amount to $5,000. The judgment lien was entered in the public record on February 7, 2014, and the mortgage lien was recorded on January 22, 2012. If the mansion is sold at the tax sale for $375,000, the proceeds of the sale will be distributed in what order?

A

1) Real estate taxes
2) Mortgage lender
3) Creditor named in judgment
4) Owner

94
Q

A mansion is ordered sold by the court to satisfy the owner’s debts. The property is subject to a $50,000 judgment lien, incurred as a result of the mechanic’s lien suit. Principal and interest totaling $295,000 remains to be paid on the mansion’s mortgage. This year’s unpaid real estate taxes amount to $5,000. The judgment lien was entered in the public record on February 7, 2014, and the mortgage lien was recorded on January 22, 2012. If the mansion is sold at the tax sale for $325,000. How much will be distributed to the creditor named in the judgment lien?

A

$25,000

95
Q

A mansion is ordered sold by the court to satisfy the owner’s debts. The property is subject to a $50,000 judgment lien, incurred as a result of the mechanic’s lien suit. Principal and interest totaling $295,000 remains to be paid on the mansion’s mortgage. This year’s unpaid real estate taxes amount to $5,000. The judgment lien was entered in the public record on February 7, 2014, and the mortgage lien was recorded on January 22, 2012. If the mansion is sold at the tax sale for $325,000. How much will be distributed to the owner?

A

$0

96
Q

A mansion is ordered sold by the court to satisfy the owner’s debts. The property is subject to a $50,000 judgment lien, incurred as a result of the mechanic’s lien suit. Principal and interest totaling $295,000 remains to be paid on the mansion’s mortgage. This year’s unpaid real estate taxes amount to $5,000. The judgment lien was entered in the public record on February 7, 2014, and the mortgage lien was recorded on January 22, 2012. If the mansion is sold at the tax sale for $375,000. How much will be distributed to the creditor named in the judgment lien?

A

$50,000

97
Q

A mansion is ordered sold by the court to satisfy the owner’s debts. The property is subject to a $50,000 judgment lien, incurred as a result of the mechanic’s lien suit. Principal and interest totaling $295,000 remains to be paid on the mansion’s mortgage. This year’s unpaid real estate taxes amount to $5,000. The judgment lien was entered in the public record on February 7, 2014, and the mortgage lien was recorded on January 22, 2012. If the mansion is sold at the tax sale for $325,000. How much will be distributed to the owner?

A

$25,000

98
Q

All liens are ___.

A

Encumbrances

99
Q

All encumbrances ___ liens.

A

are NOT

100
Q

A statutory lien is created intentionally by the owner. True or false?

A

False

101
Q

A(n) ___ lien is created intentionally by the owner’s choice.

A

Voluntary

102
Q

In Illinois, what types of properties are totally exempt from paying general real estate taxes?

A

Schools
Churches
Cemeteries
Charitable institutions
Government property

103
Q

Illinois property taxes are adjusted to reflect certain concessions given on owner-occupied residences, these properties are designated as ___.

A

Homesteads

104
Q

This property tax exemption applies to owners of single family homes, condos, cooperatives, and 1-6 unit apartment buildings.

A

Homeowner exemption

105
Q

This property tax exemption is available to homeowners over the age of 65.

A

Senior citizen homestead exemption

106
Q

The ___ program allows Illinois seniors to freeze their assessed valuation for the remainder of their lifetime once they have turned 65 if household income doe snot exceed $55,000.

A

Senior Citizen Assessment Freeze Homestead Exemption

107
Q

The Senior Citizen Assessment Freeze Homestead Exemption program allows Illinois seniors to freeze their assessed valuation for the remainder of their lifetime once they have turned 65 if household income doe snot exceed $___.

A

$55,000

108
Q

This exemption allows any Illinois homeowner who has recently improved their home to forestall an increase in the home’s overall assessed value for up to 4 years.

A

Home improvement exemption

109
Q

If there is a new addition or remodeling, the buyer’s real estate agent should be aware of which 2 things?

A

1) Mechanic’s liens
2) 4 year homestead improvement exemptions

110
Q

What are the 4 steps to determine taxes?

A

1) Locate assessed value
2) Equalize assessed value
3) Subtract any exemptions
4) Tax rate times adjusted assessed value = real estate taxes

111
Q

___ x ___ = real estate taxes

A

Tax rate times adjusted assessed value

112
Q

Tax rate times adjusted assessed value = ___

A

Real estate taxes

113
Q

In Illinois, any given parcel (outside of Cook County) receives full assessment on a(n) ___ basis

A

Quadrennial (4-year)

114
Q

In cook county, any given parcel receives full assessment on a(n) ___ basis.

A

Triennial (3-year)

115
Q

A taxing district’s budget indicates that $800,000 must be acquired from real estate taxes to pay for needed expenditures. The assessment roll (assessor’s record) of all taxable real estate within the district equals $10 million. The tax rate is computed as…

A

$800,000 divided by $10,000,000 = 0.08 or 8%

116
Q

If a property is assessed for tax purposes at $160,000 and the tax rate is 3%, assuming there is no equalization factor, what amount will the tax be?

A

$4,800

117
Q

If a property is assessed for tax purposes at $160,000 and the tax rate is 3%. The equalization factor is 120%. What is the equalized assessed value?

A

$192,000.

118
Q

If a property is assessed for tax purposes at $160,000 and the tax rate is 3%. The equalization factor is 120% and the equalized assessed value is $192,000. How much will be owed in taxes?

A

$5,760

119
Q

When a property owner fails to pay taxes on real estate in Illinois, the property may be sold in 1 of which 3 ways?

A

1) Annual tax sale
2) Forfeiture sale
3) Scavenger sale

120
Q

How can someone who has ownership or legal interest in real property prevent the real property from being sold in an annual tax sale?

A

Paying the delinquent debt

121
Q

In Illinois, the statutory period allowed for redemption on properties with six or fewer units is ___ from the date of sale.

A

2 1/2 years

122
Q

If there are no bids on property at an annual tax sale, the property is forfeited to the ___.

A

state

123
Q

Anyone who wants to purchase property in a forfeiture tax sale must submit an application to the ___.

A

County

124
Q

What 3 things must an owner pay in order to reclaim property from a forfeiture sale?

A

1) Delinquencies
2) publication costs
3) interest

125
Q

If taxes have not been paid for two years or more, the property may be sold at a(n) ___.

A

Scavenger sale

126
Q

In a scavenger sale, the property is sold to…

A

the highest bidder

127
Q

If a property is bought in a scavenger sale, the buyer is required to pay…

A

CURRENT taxes

128
Q

If a property is bought in a scavenger sale, the buyer is required to pay the tax lien. True or false?

A

false

129
Q

Which 2 people are not allowed to bid in a scavenger sale?

A

1) former owners
2) anyone delinquent in taxes for 2 or more years

130
Q

For redemption to occur, all ___ plus ___ and ___ must be paid by the redeemer.

A

taxes plus interest and penalties

131
Q

The annual due date for assessment payments in Illinois is generally on ___.

A

January 2

132
Q

A lien used by the IRS for failure to pay taxes

A

Income tax lien

133
Q

Lien that gives security to companies or persons that perform labor or furnish materials to improve real property

A

Mechanics’ liens

134
Q

Lien on a deceased person’s real and personal property

A

Estate tax

135
Q

Tax based on improvements made to the property

A

Special assessment

136
Q

Lien used to secure a loan on real estate

A

Mortgage loan

137
Q

Order issued by a court settling the parties’ obligations to a lawsuit

A

Judgment

138
Q

Tax based on the value of a property

A

Ad valorem tax

139
Q

A(n) ___ may be applied to raise or lower assessments in a particular district or county

A

Equalization factor

140
Q

What is the formula for calculating annual real estate taxes?

A

Assessed value times equalization factor minus exemptions times tax rate equals annual real estate taxes

141
Q
A

Unit 10: Real Estate Taxes and Other Liens (2 decks)

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