Section 4: Liens and Encumbrances Flashcards
1
Q
What is an Encumbrance:
* The term encumbrance is used to describe an impediment or a type of hindrance that ‘could’ LOWER the value of the property.
* An encumbrance is a right or interest in property held by someone other than the ______.
A
Legal Owner
2
Q
What is an Encumbrance:
Could be a NON-_____ type of encumbrance:
o Claim set forth by others, court issued claims, easements, government powers, or some other restrictions in the deed.
A
Monetary
3
Q
What is an Encumbrance:
Could be a _____ type of encumbrance:
o Mortgage, tax lien, IRS lien, judgements.
A
Monetary
4
Q
What is an Encumbrance:
An Encumbrance of any sort could affect the ‘_____’ of the tile.
* In some cases, encumbrances could negatively affect a properties value:
o EASEMENTS across your land
o Potential Zoning CHANGES
o UTILITY lines in your yard recorded
A
Transferability
5
Q
What is an Encumbrance:
In no case, can an encumbrance be used to prevent transfer of _____ it’s more of a hassle think of it as making it harder or less desirable of a property.
* Think of hurdles in a track race… You will finish, but by putting up hurdles, it just slows you down and makes it more difficult and less desirable to do!
A
Title
6
Q
Lien vs Encumbrance:
* A LIEN is ‘______’ claim placed against real property.
* The real property is the collateral
used to secure the lien.
o Mortgages & Home Equity Lines of Credit (HELOC) are examples of Liens.
A
Monetary
7
Q
Lien vs Encumbrance:
* An Encumbrance encompasses a much broader term, referring to any sort of claim against real property and could be either monetary or non-monetary.
o A recorded _____, a license granted to someone else to use the property, a deed restriction (that runs with the land) and of course Liens are examples of encumbrances.
All liens are an encumbrance, but not all encumbrances are liens
A
Easement
8
Q
Some more about Encumbrances:
* Non-Monetary Encumbrances:
o Non-monetary encumbrances affect the use and condition of the _____.
A
Property
9
Q
Some more about Encumbrances:
o Easements typically “run with the land” meaning they are passed on to new _____ when property conveys and all terms remain in effect.
A
Owners
10
Q
Some more about Encumbrances:
o _____ (a type of encumbrance) = A right to use or to cross over someone else’s property for a specified purpose, like ingress or egress.
Usually for LANDLOCKED property
A
Easements
11
Q
Easements:
* _____:
o In Arizona, it is illegal to sell property that is LANDLOCKED, there must be a recorded easement for access.
o Issued by court order
Right Of Way
* The right of way benefits the dominant tenant.
A
Easement by Necessity
12
Q
- ______: Any easement that benefits one piece of land or property but is a detriment to the other piece of land or property.
A
Easement Appurtenant
13
Q
Easement by Necessity:
______ = Next to / Attached to
A
Appurtenant
14
Q
Easement by Necessity:
o The property that benefits is known as the “______”.
o For the Dominant Estate, this is a “BENEFIT”.
A
Dominant Tenement
15
Q
Easement by Necessity:
o The detriment property is known as the “_____”.
o For the Servient Estate, this is an “encumbrance”.
A
Servient Tenement
16
Q
_____:
* An easement in gross benefits an individual or a legal entity
o Think of Utility companies, power lines, Gas lines, etc.
o Most properties have these easements on the front or back of their land and allow utility companies the rights to add or remove cables, lines, plumbing etc.
A
Easement in Gross
17
Q
_____: benefits a person or entity, rather than a parcel of land.
o Think of a homeowner cutting through the yard of someone else’s land to get to the Supermarket quicker.
o Used with a permission of the owner, could be a license to use.
A
Personal Easement In Gross
18
Q
Easement in Gross:
* When someone in Arizona uses another person’s land for a determined
amount of time = _____ Years in Arizona
o Must be Continuous Use.
o Must be “_____” = without the owners permission or any type of license.
o Must be Visible, Open and Notorious – the owner and public can see it, know of it.
o If separate users successively use this for periods of time, it’s known as “_____”.
A
10 Years
Adverse Use
Tacking On
19
Q
Easement in Gross:
* _____: Common items on a divided property line.
o Most often a Fence which is property of both owner who share responsibility.
o Could also be shared driveways / walkways (cluster homes).
A
Party Wall Easements
20
Q
Easement in Gross:
* _____: A land owner makes a promise to a state agency to preserve portions or all of the land for the good of the public.
A
Conservation Easement
21
Q
Easement in Gross:
* _____: A type of easement that would prohibit a neighbor from blocking your view, or, from removing trees/landscape that was part of the view.
A
View Easement
22
Q
Creating and Ending an Easement:
Easements can be created or in fact terminated:
* Creating:
o _____ – owner could create a voluntary easement by expressly offering it in a sales agreement of as part of a deed.
A
Voluntary
23
Q
Creating and Ending an Easement:
Easements can be created or in fact terminated:
* Creating:
o _____ – By court order to access landlocked property.
A
Necessity
24
Q
Creating and Ending an Easement:
Easements can be created or in fact terminated:
* Creating:
o _____ – Government could create an easement “for the good of the people”.
A
Eminent Domain
25
Creating and Ending an Easement:
Easements can be created or in fact terminated:
* Creating:
o _____ – A court order could give someone the rights to access another’s property even if the owner objects to this.
Prescription
26
Creating and Ending an Easement:
Easements can be created or in fact terminated:
* Terminating or Ending:
o ______ – an easement that is no longer used will terminate that easement.
Non-Use Easement
27
Creating and Ending an Easement:
Easements can be created or in fact terminated:
o _____ – If a property is condemned, it’s not allowed to use that easement.
Eminent Domain
28
Creating and Ending an Easement:
Easements can be created or in fact terminated:
o _____ – if the property is destroyed, there is no need for an easement.
Destruction
29
Creating and Ending an Easement:
Easements can be created or in fact terminated:
o _____ – purposeful abandonment by the Dominant Estate.
Abandoned
30
Creating and Ending an Easement:
Easements can be created or in fact terminated:
o _____ – if the owner takes back the license or denies use.
Release
31
________ = restrictions on the use of the real estate in some way.
Deed Restrictions
32
Deed Restrictions:
* They are listed in the deed.
* The seller may add a restriction to the title of the property.
* ________ usually place restrictions on each property in a community development in order to maintain a uniform look and appeal.
* Examples of deed restrictions are building heights, minimum square footage, property setbacks.
Developers
33
CC&R’s:
* CC&R = _____
Covenants, Conditions and Restrictions
34
CC&R’s:
* Written restrictions NORMALLY created by the original developer.
* Can be modified by the ______ or added to
* Similar in nature to deed restrictions, if a property owner fails to adhere to the CCR’s, the other homeowners can force legal action against the owner.
Homeowner's Association
35
CC&R’s:
HOA’s in the CC&R’s have reserved the right protect the community property for the benefit for the whole community and as such, establish rule, penalties, fines and liens.
* In AZ it is legal and possible for HOA’s to lien a property and actually foreclose in order to satisfy a lien for failure to pay ______.
Assessments
36
CC&R’s:
* This is due to the HOA trying to protect the general community (if one owner fails to pay ______ or dues, this puts the whole community at risk).
Special Assessments
37
CC&R’s:
o HOA's can NOT _____ on a homeowner for failure to pay fines/interest as these are NOT protecting the community.
Foreclose
38
CC&R’s:
o The minimum amount that must be in collection is $_____ before an HOA can begin the foreclosure process on a homeowner.
$1200
39
_____ = The failure to assert your legal rights in an appropriate time.
* There is a statutory time frame whereby if you fail to enforce the rules, you have in essence allowed this and hence, are unable to enforce later.
Latches
40
Latches:
* Latches= The failure to assert your legal rights in an appropriate time.
- EX. If a neighbor added a garage on their property and that is against the CC&R’s, the CC&Rs must be enforced in a timely fashion. If too much time goes by, the ccr’s become _____ due to the duration of time that passed.
Unenforceable
41
______ = A type of nuisance, an intrusion on a person’s territory, property or individual rights.
* Nuisance – smells, barking dogs, flood lights shining into another yard.
Encroachments
42
Encroachments:
* Encroachment = A type of nuisance, an intrusion on a person’s territory, property or individual rights.
* EX. If your neighbor's dog is constantly barking, that is an encroachment on your _____ to live in a peaceful setting!
Rights
43
______ =is an apparent encumbrance, discovered in the title search and history.
o It could impair the rights of the owner to transfer their rights free and clear.
o Examples could be previously recorded liens from a previous owner that were never released properly or could even be a recorded tax lien, mechanics lien, etc.
Cloud on a Title
44
______ = Money that will affect title to the property involved.
* Liens! Remember; Liens always represent a monetary interest.
* All liens are an encumbrance, but not all encumbrances are liens.
Monetary Encumbrances
45
Classifications of Liens (1-7):
#1 ______ = is a lien on all property, both real and personal of a debtor.
o If a person owes taxes to the IRS it is a general lien against all real and personal property of the tax payer, which could include their real property or their bank account which is ‘personal property’.
General Lien
46
Classifications of Liens (1-7):
#2 ______ = are debts that are directly tied to the real property only.
o Specific liens would be HOA liens & property tax liens.
o Another lien of this type would be borrowing money to buy the house. The lender would want to lien the property being used as collateral.
Specific Liens
47
Classifications of Liens (1-7):
#3 ______ = that one would allow and acknowledge, they elect to have that lien.
o Mortgages or HELOC.
Voluntary Liens
48
Classifications of Liens (1-7):
#4 ______ = occurs by law, such as a tax or special assessment lien.
o IRS Tax Liens, HOA Dues, Judgements.
Involuntary Lien
49
Classifications of Liens (1-7):
#5 ______ = is a written notice that a lawsuit has been filed.
o The notice is usually filed in the county land records office.
o Alerts a potential purchaser or lender that the property’s title is in jeopardy.
Equitable Lien [Lis Pendens]
50
Classifications of Liens (1-7):
#6 ______ = is any lien that is placed on the property by “an act of law”.
o Any Special Assessments placed on a property.
o Real Estate Property Taxes.
Statutory Lien
51
Classifications of Liens:
#7 ______ = Two parties have contracted to create a lien.
o Most common type of contractual lien would be a mortgage or a deed of trust.
o Another type of contractual lien could be using the equity in your home to secure a loan to build a pool.
Voluntary Liens [Contractual Lien]
52
Liens WHO and WHEN:
______ = Creditor placing the lien (could be government, lender, individual or court).
o “GIVE-OR” or giver of the lien.
Lienor
53
Liens WHO and WHEN:
______ = Debtor who owns the property (could be personal or real property).
o “RECEIV-EE” or receiver of the lien.
Lienee
54
Liens WHO and WHEN:
Liens are ranked in the order of which they were ‘_____’.
o FIRST IN TIME, FIRST IN LINE.
o Except for mechanics and materialmen’s liens (more on this later).
Recorded
55
Liens WHO and WHEN:
IMPORTANT: Real Estate ____ ALWAYS take PRIORITY.
o They will be paid if a sale takes place before any other liens, what money is left after that goes to pay the liens in the order they were recorded.
Taxes and Special Assessments
56
Special Assessments
(City, County, Local):
States, counties, or even cities, using government powers can create specific and unique ______ that they can assess against real property for certain public projects.
Charges
57
Special Assessments
(City, County, Local):
* A _______ may only be levied against parcels of real estate which have been identified as having received a direct and unique “benefit” from the public project.
Special Assessment
58
Special Assessments (City, County, Local):
Failure to pay property special assessments can also lead to a _____ lien and foreclosure.
Tax
59
Special Assessments (City, County, Local):
o Special assessments are charges that are levied against real property owners when new sewer lines, water lines, streets, or sidewalks are added.
o These special assessments are only levied against those who ______ from the specific use of whatever improvements are being made.
benefit
60
Special Assessments (City, County, Local):
o Many new communities have special assessments added to the developer costs and are passed onto the end buyer.
o CFD’s = ______
Community Facility District
61
Special Assessments (City, County, Local):
* Community Facility District's are areas where the developer is passing onto the buyer, the ______ of the schools, roads, police, fire, etc.
* Beware if you are showing new homes, you would/should ask if there is a CFD added to the price of the home!!
Costs
62
_______:
* These liens are ‘SUPERIOR’ to the rights of the HEIRS to the estate (govt, creditors get paid 1st) and can be attached to both the PROPERTY and PERSON.
IMPORTANT: * In these liens, remember, they take priority over other liens, no matter when the other liens were created or recorded.
Superior Liens
63
Superior Liens:
_______:
**(General + Involuntary + Statutory)**
o These liens arise from court order or from a lawsuit.
o After a lien has been filed, a lien is placed on both personal and real property.
o If debtor fails to pay, a writ of attachment can be filed with the courts and the assets.
o (both personal and real) can be seized by the sheriff.
Judgement Liens
64
Superior Liens:
_______:
**(General + Involuntary + Statutory)**
o Created by an act of law and are attached to personal and real property.
o Failure to pay taxes or penalties can result in an IRS lien.
o IRS liens are effective for a period of 10 years.
o Their priority is based again on the date of recording.
Income Tax Liens
65
Superior Liens:
_______:
**(General + Involuntary + Statutory)**
o Creditors can place a lien against the estate of a deceased to recover debts owed by deceased.
o Federal and State can also lien the assets of the estate to ensure settlement of taxes.
Deceased Estate Liens
66
Property Liens:
*_______:
**(Specific + Voluntary)**
o Mortgages are an example of a financing lien
o HELOC = Home Equity Line of Credit is a type of financing lien
Financing Liens
67
Property Liens:
_______:
**(Specific + Involuntary + Statutory)**
o In Arizona, all property taxes are a “lien against the property” which isn’t recorded.
o Both property taxes and city/state/county special assessments take FIRST priority over all other property liens and are always first to be paid.
Property Tax Liens
68
Property Liens:
Property Tax Liens:
o Remember, nobody steps in front of the government when it comes time to getting paid.
o Taxes pay for services provided by the government (Schools, Fire, Police, good for all).
o ______ are levied against a homeowner(s) who will benefit from the improvements (curbs, sidewalks, new street lights, etc).
Special Assessments
69
Property Liens:
______:
**(Specific + Involuntary + Equitable)**
o Justification = Is filed for the non-payment of labor already performed on a property or for job site materials that were used during the construction of the property by a contractor or sub-contractor.
Mechanics Liens
70
Property Liens:
Mechanics Liens:
**(Specific + Involuntary + Equitable)**
Who has the lien right? - In Arizona, it is legal for either a general contractor or a subcontractor to file a ______.
Mechanics Lien
71
Property Liens:
Mechanics Liens:
**(Specific + Involuntary + Equitable)**
Pre-lien Notices - A ______-day notice must be given to the owner, general contractor, or lender, prior to the lien being filed (Actual Notice Given).
20-Day
72
Property Liens:
Mechanics Liens:
**(Specific + Involuntary + Equitable)**
o What does a mechanic’s lien attach to – ______ where work was performed.
Real Property
73
Property Liens:
Mechanics Liens
**(Specific + Involuntary + Equitable)**
o Priority of Mechanic’s Liens – priority is in the order of “_______”.
Which They Were Recorded
74
Property Liens:
Mechanics Liens
**(Specific + Involuntary + Equitable)**
o Release of mechanic’s liens – A release must be recorded within ______ days of lien release.
20 Days
75
Property Liens:
Mechanics Liens
**(Specific + Involuntary + Equitable)**
o Statutory rights/time periods - A 20-day notice must be given to the owner, general contractor, or lender, prior to the lien being filed (Actual Notice Given).
o Any mechanics lien to be filed by any contractor, must take place within 120 days of “job completion” (20 day notice + 100 days = ______ days total).
120 Days
76
Like a mechanic’s lien, a Materialmen’s Lien acts to protect suppliers of material to a
home owner.
* Any type of material used in the construction, renovation, or reconstruction of a property that was delivered in good faith with the expectation of getting paid by the owner.
* Like a mechanics lien, a 20-day notice must be given to the owner of the property, giving them actual notice of a pending lien.
* $1,000 is the MINIMUM amount of a materialman lien.
20-Day
77
Who Can Not File Mechanics Liens?
* A ______ supplying materials to another supplier.
Supplier
78
Who Can Not File Mechanics Liens?
* A subcontractor to a ______
Subcontractor
79
Who Can Not File Mechanics Liens?
* ______ contractors - if a license was required to do the work performed.
Unlicensed
80
Who Can Not File Mechanics Liens?
* If unable to provide _____ of the required 20 day notice.
Proof
81
Who Can Not File Mechanics Liens?
* If ______ written agreement or receipt of work can be furnished.
No
82
Who Can Not File Mechanics Liens?
* NOTE: a licensed contractor is REQUIRED to be used in Arizona when the job scope is over $_____.
$1000
83
How Liens Affect Primary Title Reports?
* During the initial phases of the purchase and transfer of ownership the escrow company will do a preliminary title search where they look for liens and other
encumbrances.
* If a lien or encumbrance is found, it is made ______ to all parties and the seller or
owner of the lien has the right to satisfy the lien/encumbrance.
* If the lien isn’t satisfied, the escrow company can NOT offer a title insurance policy for the buyer.
Evident
84
**All liens are an encumbrance, but not all encumbrances are ______**
Liens
85
A utility company has a (an) ______________ that runs through your property.
Easement
86
Which of the following would NOT be a way to end an easement?
Agreed upon release
Non-Use
Additional parties using the easement
Destruction
Additional parties using the easement
87
Which of these is NOT a type of easement?
Easement in Gross
Easement Appurtenant
Easement in Monetary
Easement by Necessity
Easement in Monetary
88
What negative effects can an encumbrance have on a property’s value?
Encumbrance is something that could affect the transferability of the property but is not always a negative, but, like a lien or a HOA, some owners don’t want these types of encumbrances and so it is harder to sell or convey.
89
Is a lien always an encumbrance? Is an encumbrance always a lien?
A lien is always an encumbrance, a financial encumbrance, but not all encumbrances are liens – think of an HOA CC&R’s.
90
Give one example of how an easement can be created…
Voluntary, By Law, By Prescription, By Necessity or in some cases by continuous use
91
Give one example of how an easement can be ended…
Abandonment, Law, Recission by Grantor are examples of how it can be terminated.
92
An Easement is what type of encumbrance?
Voluntary
Involuntary
Voluntary or Involuntary
Beneficial to all
Voluntary or Involuntary
93
A change in zoning directly across the street would be a potential :
Non-Monetary Encumbrance
Choice Monetary Encumbrance
Potential Encumbrance
Zoning Encumbrance
Potential Encumbrance
94
Which of the following would most likely hinder the transfer of clear title to a property in a community?
HOA CCR’s
Utility Company Easement
Cities special assessments
A homeowners back tax lien
A homeowners back tax lien
95
A non-court ordered easement by prescription must be __________, __________ and ___________ to be legally recognized?
Legal, allowed and recognized
Open, Official and Recognized
Visible, Open and Notorious
Visible, Recorded and Acknowledged
Visible, Open and Notorious
96
Informational Point: If you own a house, land or property, you can look up the deed most likely in the county recorders office or online for free. In the deed, you will find any reservations or restrictions! Most often, homes in a community have a restriction that says oil, gas, minerals etc if found in the ground belong to the _____!! Fun to read, better to look like a super genius when you tell your clients this!
Developer
97
True or False: An HOA can foreclose on a homeowner for failing to pay fines.
True
False
This is false. They can only foreclose on a homeowner if they don't pay their DUES or assessments!!
98
Clouds:
Additional clouds as we talked about earlier were gaps in the ownership, or a death within a marriage, where the remaining spouse sold and a _____ certificate was never found or recorded.
* This is a cloud as in Arizona, you need both spouses to sign the deed to sell! You will learn more about that later!
Death
99
Monetary Encumbrances:
Remember: All liens are an ____, but not all encumbrances are liens.
Encumbrance
100
Liens:
Liens always represent a monetary ______ that someone else has in your property.
Interest
101
Give an example of a type of Deed Restriction?
Deed restrictions could be made by owner/developer/CCR etc. A building height, land use, ownership of minerals, property use types, type of construction material used, these are all types of Deed Restrictions.
102
What is the difference between Deed Restrictions and CC&Rs?
A deed restriction is something written into the deed that restricts someone from doing something, like building a two story home or more common, accessing minerals, oil or gold below the ground (those mineral rights are restricted and retained by the previous owners). For the CC&R's, these conditions, covenants and Restrictions effect every house or property in the entire community.
103
A neighbor builds a new roof for their pool shed and it overhangs into your property. Why would it be considered wise to enforce your legal rights to have the shed roof modified in a timely fashion?
Failure to asserts one's rights in a timely fashion lessons the ability to enforce rules in the future this is known as latches.
104
The neighbor failed to pay their contractor for modifying the shed roof leading the contractor to file a mechanics lien against the property. Should the owner try and sell the house without first terminating that encumbrance, what will appear during a title search?
A lien would show up as an encumbrance and would need to be satisfied before the deed could transfer freely, or the title insurance company would not put insurance on the property.
105
A title policy underwriter discovers a defect in the chain of title and they can't seem to find where a previous owner ever signed the deed to the current owner. This defect would cause what potential action?
A cloud was found and can be easily cleared by the title company
A title policy most likely won’t be issued
The new buyers of the property would need to clear the defect
A title policy could be issued but would have a defect note
A title policy most likely won’t be issued
106
HOA CC&R’s are considered an:
Entitlement
Encumbrance
Escheat
Easement
Encumbrance
107
A buyer moves into their new home then are served by papers to pay a lien from a previous contractor that worked on the house 2 years ago. What should the owner do?
Pay the lien immediately
File a delay of action in court
Refer this to their title insurance policy
Arbitrate through the Board of Contractors in Arizona
Refer this to their title insurance policy
108
Which of the following would most likely hinder the transfer of clear title to a property in a community?
HOA CCR’s
Utility Company Easement
Cities special assessments
A homeowners back tax lien
A homeowners back tax lien
109
A neighbor’s trees are hanging over the fence line in the backyard. The offended homeowner has complained to the HOA but they can't help as this is not an HOA issue. The HOA referred the owner to file a complaint against the neighbor due to what action?
Involuntary Alienation
Agreement Violation
CC&R Violation
Encroachment
Encroachment
110
An HOA can foreclose for failure to pay dues or assessments but the minimum owed must be at least how much?
$1200
$900
$500
$280
$1200
111
HOA's may not be able to enforce the illegal paint color change on a property that was sold 2 years ago due to what?
Latches
Fault
Languish
Statute of Limitations
Latches
112
CC&R violations discovered by an escrow company would be?
Encumbrance
Chattel
General Lien
Voluntary Cloud on Title
Encumbrance
113
What would a potential lien be for someone who failed to pay their income taxes?
A.The failure to pay taxes would most likely result in a lien against both your home and personal assets like cars, bank accounts or even job wages.
B. This would be a case where the IRS could only garnish your wages in an attempt to collect on the debt.
The failure to pay taxes would most likely result in a lien against both your home and personal assets like cars, bank accounts or even job wages.
114
A property owner fails to pay their real estate property taxes and a statutory lien is place on the property. What type of encumbrance is this?
This is a monetary, judicial, involuntary lien.
115
Liens are paid first in time, first in line with two exceptions. What is one of these exceptions?
Property Taxes and Government Liens are always paid before anyone else.
116
Who is the Lienee? Who is the Lienor?
The Lienor is the “giv-or” of the lien, or the person who is owed money while the Lienee is the “receiv-ee” of the lien and owes that money.
117
When would an owner voluntarily agree to have a lien placed on their property?
When the owner needs a mortgage, deed of trust or otherwise wants to allow someone voluntarily to lien the property usually to borrow against.
118
Governments can levy liens against a deceased person’s estate. These are:
Voluntary
Creditor Liens
Statutory
Recorded at time of death
Statutory
119
Which of the following is a voluntary lien?
Mechanics Lien
Common Lien
Mortgage
Income Tax Lien
Mortgage
120
The IRS has the power to lien both personal and real property. This is what type of encumbrance?
General, Involuntary, Statutory
General, specific, involuntary
Specific but involuntary
General but involuntary
General, Involuntary, Statutory
121
The city and state have been provided the power to encumber your property by taxing the owner of each parcel of land. Even the smallest parcel of land is taxed. What type of encumbrance is this?
Specific and Voluntary
Specific and Involuntary
Specific, Voluntary and Statutory
General, Involuntary and Statutory
Specific and Involuntary
122
A non-court ordered easement by prescription must be __________, __________ and ___________ to be legally recognized?
Legal, allowed and recognized
Open, Official and Recognized
Visible, Open and Notorious
Visible, Recorded and Acknowledged
Visible, Open and Notorious
123
By agreeing to take out a Home Equity Line Of Credit (HELOC) on their home, the owners allowed the lender to place what on their title?
A recorded promissory note
A due on sale clause
A voluntary specific lien
A copy of the lien release due date
A voluntary specific lien
124
Property Liens are specific to ONE property.
125
Property Liens:
Mechanics Liens:
**(Specific + Involuntary + Equitable)**
These are the types of mechanics/contractors that can file a lien legally:
- direct contractors
- subcontractors
- material suppliers
- equipment _______
- laborers - in some cases
Lessors
126
Which of these is NOT a superior lien…
Income Tax Lien
Non Judgement Lien
Financing Lien
Deceased Estate Lien
Non-Judgement Lien
127
IMPORTANT! A lien is encumbering the title - this means that someone somewhere has a claim to the title - not the _____. You can still sell or convey the property, but the lien most likely will follow the deed to the new owner/buyer!
Deed
128
Can a lien be applied for multiple reasons?
Yes, for example Judgement Liens, Income Tax Liens, and Deceased Estate Liens.
129
Who can file a Mechanics Lien in Arizona?
In Arizona, it is legal for either a general contractor or a subcontractor to file a mechanics lien.
130
Does a notice have to be given to the owner/entity that the mechanic’s lien is being placed on? If so, how much notice?
Yes, a 20-day notice must be given to the owner, general contractor, or lender, prior to the lien being filed (Actual Notice Given).
131
If a preliminary title search reveals a Cloud on Title and the encumbrance is not satisfied by the seller, what will the title company NOT be able to provide? How will this effect a buyer’s ability to secure a loan?
If a lien or encumbrance is found, it is made evident to all parties and the seller or owner of the lien has the right to satisfy the lien/encumbrance. If the lien isn’t satisfied, the escrow company most likely won’t offer a title insurance policy for the buyer.
132
Property taxes, mechanics lien, mortgage lien; which comes first?
None, IRS liens come first
Mechanics Lien
Mortgage LIen
Property Taxes
Property Taxes
133
A lumber yard didn’t get paid from the framing contractor who was hired by the General Contractor. They have how long to file a lien on the property where the material was used?
They can’t file a lien as a supplier of materials used on a job
90 days from when the material was dropped on the site
90 days from the date the work started
90 days after the invoice was first sent
They can’t file a lien as a supplier of materials used on a job
134
Landlocked property must be granted an easement and is known as the:
Dormant Tenement
Dominant Tenement
Divisive Tenement
Disputed Tenement
Dominant Tenement
