creditors rights Flashcards
When obtaining a judgment lien against a debtor’s real estate, this remedy is based on
the recording system for real estate.
For priority purposes, the general rule is that the first to
docket has priority over subsequent docketed liens.
The judgment lien actually arises when
the judgment is docketed in the real estate recording system and becomes visible, this is a public act.
A judgment is automatically docketed
by the clerk of court in the county where the judgment is rendered.
A judgment lien is a floating lien on
all non-exempt real property in the county, and it attaches automatically to after acquired property.
To then enforce a judgment lien the creditor must
ring a suit in equity in the city or county where the land is located.
A commissioner will be appointed to
determine ownership and interests in the property and then conducts a sale of the property.
The judgment lien creditor must
notify junior lien holders.
Unless they are joined, those junior interests are
not affected by the sale
if joined, junior interests
are cut off
Senior interests to that of the creditor holding the sale
aren’t affected by the sale, the purchaser will take subject to senior liens.
A deed of trust is
a security interest in land, synonymous with a mortgage
in a deed of trust,The debtor is the trustor, who
gives a deed of trust to a third party trustee who is typically connected with the lender, who is the beneficiary
When a default occurs, the lender instructs the trustee to
foreclose the deed of trust by sale
In Virginia, with a deed of trust: legal title to the property is conveyed to the trustee, and the debtor retains
the equitable right to repay the indebtedness secured by the trust and obtain the property upon full repayment
A trustee who sells a property after the buyer defaults may
first apply the proceeds to discharge the expenses of executing the trust
A creditor can also satisfy a judgment with a
writ of execution or fi fa, for tangible personal property
The writ of fi fa commands the officer to whom it is delivered to
locate the property of the debtor, seize it, and sell it to satisfy the judgment.
with a writ of fi fa, The lien is created by
a levy on the property by the sheriff, and the levy is the public act
For tangible personal property the clerk of the court must
issue a writ of fi fa within 21 days from the date of judgment unless otherwise instructed by the creditor, and the lien attaches at the time of the levy.
In order for the levy to be proper:
(i) the property must actually belong to the debtor at the time of the levy,
(ii) the sheriff must seize the property, or observe with the power to exercise control or dominion,
(iii) the sheriff must serve a copy of the writ on the judgment debtor,
(iv) the sheriff must describe the property seized in the return.
The sheriff can then conduct a public sale of the personal property.
A judgment lien attaches only to
the debtor’s interest in property, and it doesn’t attach to a tenancy by entirety
A creditor may attach a tenancy by the entirety only where
hey are owed a debt by the spouses as single unit, such as cosigning a loan.
a general creditor only has a claim against
the total assets of the debtor and must obtain a lien on the debtor’s property before the debtor can be forced to make payment