Unit 10 - Real Estate Taxes and Other Liens

Question 1

Define a Lien

Answer 1

A charge or claim against property made to enforce payment

Question 2

What are the types of lien?

Answer 2

Voluntary
Involuntary
General
Specific

Question 3

Define a voluntary lien?

Answer 3

A mortgage

Question 4

Define an involuntary lien?

Answer 4

A lien created by law or court, mechanics lien.

Question 5

Define a Statutory Lien

Answer 5

A lien created by statute

Question 6

Define an Equitable Lien

Answer 6

A lien created by court to ensure payment

Question 7

Define a General Lien

Answer 7

A lien which affects real and personal property

Question 8

Define a Specific Lien

Answer 8

A lien secured by specific property & affect particular property

Question 9

Which liens take priority?

Answer 9

Real estate and special assessments take priority. Followed by mechanics liens

Question 10

Define a Subordination Agreement

Answer 10

Allows a holder of a newer lien to move ahead of an older lien

Question 11

Define General Real Estate Taxes

Answer 11

Also called Ad Valorem taxes, based on the value of property, and pay for a wide range of government services and programs

Question 12

Who is exempt from property taxes?

Answer 12

Schools, churches, governments

Question 13

Define a homestead exemption

Answer 13

A legal regime to protect the value of the homes of residents from property taxes and creditors

Question 14

Define an Assessment

Answer 14

An official evaluation process, based on sales price of comparable properties

Question 15

What percentage is real property assessed at?

Answer 15

33 1/2%

Question 16

How are real estate taxes calculated?

Answer 16

Tax Rate x Adjusted Assessed Value

Question 17

Define Equalization

Answer 17

Is used to correct inequalities in state wide tax assessments, which is adjusted annually

Question 18

What does a government Budget cover?

Answer 18

Covers the financial requirements of the taxing body for the fiscal year

Question 19

Define Appropriation

Answer 19

Involves adoption of an ordinance/law authorized expenditure of funds

Question 20

Define Special Assessments

Answer 20

Taxes on real estate to fund public improvements

Question 21

Define Special Services Areas

Answer 21

Special taxing districts issued to pay for infrastructure

Question 22

When do liens expire?

Answer 22

2 years after completion, suits to enforce lien must be filed within 2 years