Exam 3 CHP 13 Flashcards
Something used to bargain. For example, a written promise or order to pay a certain sum of money,
Negotiable instruments
Another form of commercial paper, an acknowledgment by a bank that it has received money from a customer with a promise by the bank that it will repay the money received at a date specified or, in some instances on demand.
Certificate of Deposit
A promise by one party, called the maker, to pay a certain sum of money to another party, the payee.
Promissary note
A draft drawn on a bank and payable on demand.
Check
Issues or creates the document that requests payment, probably from a bank, but it could be from another party.
Drawer
An entity that agrees to make the payment, such as the bank making a payment based on a document presented to it.
Drawee
Party to receive payment, who is also the beneficiary who will be paid by the drawee.
Payee
A form of check in which the bank is both the drawer and the drawee.
Cashier’s check
A lien that may apply to personal property. Offers the right to continue to hold goods on which work has been done.
Possessory lien
The most common lien for work performed. Must be filed 90 days after. Can place a lien on a construction or repair of a building or real property.
Mechanic’s lien
How many days do you have to file a lien after the last labor or materials performed on the real estate?
120 days
Has a lien life of 10 years, tied to the “thing” and follows it, even after the sale.
Property lien
A ruling made by a court against a debtor in default on a secured loan, indicating that the sale of a property to pay back the loan did not cover the outstanding debt in full. It is mostly a lien placed on the debtor for further money.
Deficiency judgment
A court awarded lien against the debtor’s real property.
Judgment lien
The debtor who deals with mortgages.
Mortgagor
The creditor who deals with mortgages.
Mortgagee
A statutory procedure under which a creditor gains the right to attach up to 25% of the customer’s net wages to be applied to the outstanding debt.
Garnishment
A code that states how matters are resolved when debts are greater than assets available.
Bankruptcy code
The chapter of bankruptcy that deals with liquidation by the discharge of most debts after-sale and distribution of the proceeds on the debtor’s non-exempt assets to the creditors.
Chapter 7 bankruptcy
Document for an application involves:
- List of creditors
- Source, amount, and frequency of debtors income
- List of debtors property
- List of monthly expenses.
Petition filed for bankruptcy
What is the priority of claims to be paid? (1,2,3,8)
- Secured creditors
- Costs of preserving and administering the debtors estate
- Unpaid wage claims
- General (unsecured) creditors who can file proof of a claim.
Debts of which cannot ask for more money after already receiving the most offered from bankruptcy.
Discharged debts
A chapter of bankruptcy that applies to businesses that wish to remain in operation and not be liquidated.
Chapter 11 bankruptcy
The bankruptcy chapter considered the wage earners plan. Available only for individuals. Debtor retains their property and shares administration of the bankrupt estate with a court-appointed trustee.
Chapter 13 bankruptcy
What is the highest percentage that can be garnished?
25%
An enforceable legal claim or lien on collateral that has been pledged, usually to obtain a loan. Gives the lender the right to repossess all or part of the property if the borrower stops making loan payments. In this case, land.
A security interest in land
A type of lien that permits an artisan to retain possession of a piece of work until it has been paid for.
Artisan’s lien
