Liens Flashcards
What is a lien?
A lien is a secured interest that a party (lien or) has in the property of another (Ilene). This results because of a debt or obligation of the lienee(debtor) to the lienor(creditor). A lien can from debtor can be in personal or real property.
A lien allows creditor to foreclosure (forced sale) should debtor default.
Until foreclosure, TITLE remains w/ debtor (title holder).
The creditors only receive title if they are the highest bidder at the foreclosure sale.
There may be multiple creditors w/ a secured interest. If so, then priority of lien is important.
Proceeds from a foreclosure may not be sufficient to pay all creditors.
Priority of Lien is decided how?
Priority of lien in Hawaii is determined by the date it was recorded at the Bureau of Conveyances.
FIRST in TIME , FIRST in LINE
Certain statutory liens become unenforceable after lapse of time.
A financing statement is good for only 5 years unless it is extended.
A mechanic’s lien for only 3 months from the order directing the lien to attach.
Liens can be created how?
Liens can be created of the parties or by law.
Agreement of Parties. Is Voluntary
The creditor requests debtor give him a secured interest in property in order to receive financing. Mortgage
Creating a lien by law. It is statuatory and INvoluntary.
Law states that if a debtor defaults in his obligations in specific situations, then the creditor has a lien in the property of the debtor.
The debtor does not pay his property taxes for 3 years.
Can be judgement liens,, special assessment liens by associations, mechanic’s lien.
Types of liens
A lien can be general ( affecting all of debtor’s property). Or
Specific (affecting only a particular property)
A specific lien.
These liens attach only to specific parcel of property that it is likened against.
Mortgage Lien
Real Property Tax Lien. If real property taxes not paid for at least 3 years County can forclose
Statuatory Involuntary General Liens
A lien imposed by law w/out consent of the lienee (involuntary) and attaches to all the lienee property (general)
These liens attach to all of the properties of the lienee, both personal and real property.
Judgement Lien: when a party wins a civil lawsuit
Federal and State Tax Liens: when a party fails to pay federal or state taxes
Statutory INVOLUNTARY Specific Liens
A lien imposed by law w/out consent of the lienee and attaches to a specific parcel of real property.
Association lien has priority to all other liens except government lien taxes and assessments and/or. Recorded mortgage liens recorded prior to recordation of the AOAO lien
Mechanic’s and Materialman’s Lien:
Notice of Lien must be recorded no later than 45 days after the date of completion of the improvement.
Date of completion is the date the owner completes the publication of a notice that improvement completed or abandoned.
If notice of completion is not recorded w/in 1 year of actual completion or abandonment of improvement, the date of completion is 1 year after actual completion or abandonment.
The lien expires 3 months after the entry of the Order Directing Lien to Attach unless proceedings are started within that time to collect amount due.
Has priority except for. Any branch of gov. Lien; mortgages, liens or judgements recorded prior to work commencement or mortgages recorded prior to date of completion in which all or a portion of the money advanced under and secured
By the mortgages are used to pay for the improvements.
