Unit 15 Flashcards
Lien
A claim of a creditor or taxing authority against the real property of a debtor that is used as security to ensure repayment of debt. Is an encumbrance (runs with the land) and lessens its value or impairs its use because it binds all successive owners until paid and cleared
If a debtor defaults in payment of a debt secured by property
The lienholder can force a sale, or acquire title
Voluntary lien
Created by action of owner, such as a mortgage
Involuntary
Created without the owner’s express permission. May also be statutory, if permitted by statute, or equitable if granted by a court
General lien
Affects all of a debtor’s property, both real and personal
Specific lien
Affects only identified property
Priority of liens
Determines order in which claims will be satisfied (paid off). Generally first lien to be recorded will take priority, but real estate taxes and special assessments take priority over all liens.
Subordination agreement
Change order of priority?
Real Estate Taxes
AD VALOREM taxes based on value of the property taxed
Assessed value
Based on sales prices of comparable properties
Equalization factor
To correct inequalities in statewide tax assessments
Mills
1/1000 of a dollar or $0.001
Delinquent
Equitable right of redemption
Statutory right of redemption
Special Assessments
Mortgage Lien
Voluntary lien given to a lender by a borrower as security for a real estate loan
Mechanic’s lien
Specific involuntary lien that gives a security interest in real property to persons or companies that perform labor or furnish material to improve the property. Filed when owner has not fully paid for work or the general contractor has been compensated but has not paid subcontractors or suppliers
Notice of nonresponsibility
Judgement
Decree issued by court, general and involuntary, equitable lien on both real and personal property owned by a debtor and must be filed in every county in which debtor owns property
Lis Pendens
While a lawsuit is pending. Can be filed to give notice of an action pending relating to the title ot possesion of real property and establish priority of the claimant, and a writ of attachement can be sought from the court to authorize the sherif to seize the property if debtor may attempt to transfer
Writ of execution
Estate and Inheritance tax liens
General, statutory, involuntary liens that encumber a deceased person’s real and personal property and are normally paid or cleared in a probate proceeding
Lien for municipal utilities
Specific, equitable, involuntary lien on property of the owner who refuses to pay bills for municipal utility services
