Real Estate Unit 15-Real Estate Taxes and Other Liens Flashcards

Real Estate Unit 15-Real Estate Taxes and Other Liens Flashcards Most state laws exempt certain real estate from taxation.Such property must be used for tax-exempt purposes, as defined in the statutes. The most common exempt properties are owned by-cities-various municipal organizations (such as schools, parks, and playgrounds)-state and federal governments-religious and charitable organizations-hospitals-educational institutions Real estate is valued for tax purposes by county or township assessors or appraisers. This official valuation process is called assessment encumbranceany charge or claim that attaches to real property and lessens its value Some states grant a period of redemption after the tax sale.In this case, the defaulted owner (or the defaulted owner's creditors) may redeem the property by paying the amount collected at the tax sale plus interest and charges (including any taxes levied since the sale). This is known as a statutory right of redemption A special assessment is a tax charged on real estate to fund public improvements to the property, and it creates a lien for the amount of the assessment on the property.Property owners in the improvement area are required to pay for the improvements because their properties benefit directly from them.ad valorem taxes.Real estate taxes that are delinquent for the period specified in state law can be collected through A mortgage lien is a specific, voluntary lien on real estate given to a lender by a borrower as security for a real estate loan A mechanic's lien is a specific, involuntary lien that gives security to persons or companies that perform labor or furnish material to improve real property Special assessments are levied and create a lien on property that benefits from public improvements and are always specific and statutory, but may be voluntary or involuntary, and are usually paid in annual installments over a period of years.A mortgage lien is a voluntary lien given to a lender by a borrower as security for a real estate loan. The lien takes effect when the lender records the documents in the county where the property is located. A first mortgage lien on a property, when recorded, has priority over other liens (except for tax liens); subsequent liens are junior liens.A judgment is a decree issued by a court. When the decree establishes the amount a debtor owes and provides for money to be awarded, it is called a money judgment A judgment is a general, involuntary, equitable lien on both real and personal property owned by the debtor tax sale of the propertyTo enforce a judgment, what must the creditor obtain

There are two types of real estate taxes:-general real

estate taxes-special assessments or improvement taxes Both are levied against specific parcels of property and automatically become liens on those properties.A writ of execution from the courtPriority of liens refers to which of the following?Order in which liens will be paid if property is sold to satisfy a debt What would permit a law enforcement officer to seize and sell a debtor's property?In some jurisdictions, when it is necessary to correct inequalities in statewide tax assessments, an assessment equalization factor is used to achieve uniformity.LEARN THIS!!The tax rate may be stated in a number of ways. In many areas, it is expressed in mills. A mill is 1/1000 of a dollar, or $0.001. The tax rate may be expressed as a mills-per-dollar ratio-for instance, in dollars per hundred or in dollars per thousand. A tax rate of 0.032, or 3.2%, could be expressed as 32 mills, or $3.20 per $100

of assessed value or $32 per $1,000 of assessed value.A judgment, a decree issued by a court, is a general, involuntary, equitable lien on both real and personal property owned by a debtor and must be filed in every

county in which the judgment debtor owns property.The right of a defaulted taxpayer to recover property before its sale for unpaid taxes is

Municipalities often have the right to impose a specific, equitable, involuntary lien on the property of an owner who refuses to pay bills for municipal utility services.A real estate owner who is charged with a crime that will result in a trial may post bail in the form of real estate rather than cash. The execution and recording of such a bail bond creates a specific, statutory, voluntary lien against the owner's real estate. If the accused fails to appear in court, the lien may be enforced by the sheriff or another court officer.tax liens usually are given priority over all other liens against a property.A tax sale is usually held according to a published notice after a court has rendered a judgment for overdue taxes, penalties, and administrative costs and has ordered that the property be sold A property tax lien can be effective and take priority over other liens, even if it is not made part of the public record

The process of imposing property taxes:1-a budget is

adopted by each taxing district for the coming fiscal year2-The funds needed are appropriated by ordinance3-A tax levy is agreed to by a vote of the taxing district's governing body4-Each property owner's tax bill is computed by applying the tax rate to the assessed value of the property5-Tax bills are delivered to property owners, indicating the due dates for payments equitable right of redemptionA mechanic's lien would be available to:-contractors-real estate professionals-surveyors-subcontractors writ of execution.A writ of execution directs the sheriff to seize and sell as much of the debtor's property as necessary to pay both the debt and the expenses of the sale.General real estate taxes levied for the operation of the government are -A statutory lien is created by statute, or written law. A real estate tax lien, for example, is an involuntary, statutory lien.-An equitable lien arises out of common law, or law based on legal precedents. A court-ordered judgment that requires a debtor to pay the balance on a delinquent charge would create an involuntary, equitable lien Liens may also be classified according to the type of

property involved:-General liens affect all the property, both

real and personal, of a debtor. This includes judgments, estate and inheritance taxes, decedent's debts, corporate franchise taxes, and Internal Revenue Service taxes-Specific liens are secured by specific property and affect only that particular property. Specific liens on real estate include vendors' liens, mechanics' liens, mortgage liens, real estate tax liens, and liens for special assessments and utilities.A judgment creates a lien on both real and personal property owned by a debtor and

is:-general-involuntary-equitable

A provider of construction materials may give constructive notice of his unpaid invoices by For example, the construction of paved streets, curbs, gutters, sidewalks, storm sewers, or street lighting increases the value of properties that benefit from them Property can be sold for nonpayment of taxes, even if the current owner was not aware of the debt against the property A judgement lien is a general involuntary lien If improvements that were not ordered by the property owner have commenced, the property owner should execute a document called a notice of nonresponsibility to be relieved from possible mechanic's liens.