Unit quiz 13 Flashcards
A general contractor recently filed suit against a homeowner for nonpayment. The contractor now learns that the homeowner has listed the property for sale with a real estate professional. In this situation, which of the following will the contractor’s attorney use to protect the contractor’s interest?
A) Seller’s lien
B) Assessment
C) Lis pendens
D) Buyer’s lien
C) Lis pendens
A recorded lis pendens—a notice of action pending—warns any potential purchaser that a property is subject to a pending legal action. Such a notice might prompt a buyer to consider very carefully whether to proceed, but it would not absolutely prevent it.
The current market value of a property is $35,000. For tax purposes, it is assessed at 40% of market value. The tax rate is $4 per $100 of assessed value. What is the amount of the tax due?
$560
$35,000 (market value) × 40% (0.40) = $14,000 (assessed value); $14,000 ÷ 100 = 140; and 140 × $4 tax rate = $560 tax due.
A lien against a parcel of real estate may result from a lawsuit currently before the court. Notice of a possible future judgment could be found by examining the public records for
Lis pendens
A mechanic’s lien is properly classified as
A) a general lien.
B) a voluntary lien.
C) a specific lien.
D) an equitable lien.
C) a specific lien.
A mechanic’s lien is a specific lien because it affects a specific property and only that particular property.
A seller sold a buyer a parcel of real estate. Title has passed, but to date the buyer has not paid the purchase price in full, as originally agreed. If the seller wants to force payment, which remedy is the seller entitled to seek?
A) Attachment
B) Judgment
C) Mechanic’s lien
D) Lis pendens
B) Judgment
The seller could seek a monetary judgment based on a vendor’s (seller’s) lien for unpaid portions of the purchase price not secured by a mortgage.
A specific parcel of real estate has a market value of $160,000 and is assessed for tax purposes at 75% of market value. The tax rate for the county in which the property is located is 40 mills. The tax bill will be
$4800
The mill rate is the tax on every dollar of the assessed value of property. A rate of 40 mills ($0.040) is applied to 75% of the $160,000 market value of the property: $160,000 × 75% = $120,000, and $120,000 × $0.040 = $4,800.
A mill is
1/1000 of a dollar: $0.001.
Which of the following is a specific, involuntary, statutory lien?
A) Income tax lien
B) Judgment lien
C) Real estate tax lien
D) Estate tax lien
C) Real estate tax lien
A real estate tax lien is always on a specific piece of realty; it happens without permission of the property owner and so is involuntary; it is created by statute. Therefore, it is
specific, involuntary, and statutory.
Which lien usually would be given highest priority in disbursing funds from a foreclosure sale?
A) Judgment rendered the day before foreclosure
B) Mechanic’s lien for work started before the mortgage was made
C) Mortgage dated last year
D) Real estate taxes due
D) Real estate taxes due
Unpaid real estate taxes take priority when property is liquidated at a foreclosure sale. They are a statutory lien with priority over liens created by contract, such as mortgages.
When a company furnishes materials for the construction of a house and is subsequently not paid, it may file
A) an estoppel certificate.
B) a deficiency judgment.
C) a mechanic’s lien.
D) a lis pendens.
C) a mechanic’s lien.
A (?) gives security to persons or companies that perform labor or furnish material to improve real property and can be filed when the owner has not fully paid for the work.
mechanic’s lien
