9.D.3 General and Specific Liens

LIEN RESTRICTIONS

"Lien" means a charge against or an interest in property to secure payment of a debt or performance of an obligation; Is an example of an encumbrance placed on the title to a real property, and includes: - a security interest created by agreement - a judicial lien obtained by legal or equitable process or proceedings - a common-law lien, or - a statutory lien. - It limits the ability of the property owner to sell the property. - It can entitle the holder (lienor) to have property sold, regardless of the owner (lie nee) desires - is put on a property because of the outstanding debt of the owner, often related to the acquisition or repair of the subject property. - The lienor, may sell the property to satisfy the debt, thus overriding the rights of the lie nee. Liens are usually considered to be either voluntary or involuntary. "Property" means anything that may be the subject of ownership.

Judgment lien

A court ruling that gives a creditor the right to take possession of a debtor's real property if the debtor fails to fulfill his or her contractual obligations. - may be made against an individual or business - allows the creditor to access the debtor's business, personal property and real estate, among other assets, to pay the judgment. - it remains until paid or expires with time - it attaches current and future properties

Mortgage lien:

A lien voluntarily placed on property by the borrower. He pledges the property as security to the lender. - the date that the mortgage is filed and recorded establishes the priority of the lien again other claims. - if not paid, it can force the sale (foreclosure) PRIORITY: DATE IS RECORDED

SPECIFIC LIENS

A specific lien does not open all of a debtor's properties to foreclosure. Instead, it applies only to a specific property given as security in return for a loan. Types: - Property tax - Special assessment tax lien - mechanic's lien - the vendor's lien - mortgage lien.

Construction's lien (also known as materialman's liens):

Based on "Unjust Enrichment" The lien law authorizes those that furnish labor and material to improve real property as well as those that perform professional services, such as architects, landscape architects, engineers, interior designers, land surveyors and mappers to file a Specific lien as security for payment. - A Claim of Lien must be recorded within ninety (90) days from the date the lienor last furnished labor or materials to the project. - if performing small repairs after.... it needs to be done before those 90. - Law prohibits a lienor from waiving its right to file a lien in advance of performing the work. - lien most be recorded 90 days

WARNING!

FLORIDA'S CONSTRUCTION LIEN LAW ALLOWS SOME UNPAID CONTRACTORS, SUBCONTRACTORS, AND MATERIAL SUPPLIERS TO FILE LIENS AGAINST YOUR PROPERTY EVEN IF YOU HAVE MADE PAYMENT IN FULL. UNDER FLORIDA LAW, YOUR FAILURE TO MAKE SURE THAT WE ARE PAID MAY RESULT IN A LIEN AGAINST YOUR PROPERTY AND YOUR PAYING TWICE. TO AVOID A LIEN AND PAYING TWICE, YOU MUST OBTAIN A WRITTEN RELEASE FROM US EVERY TIME YOU PAY YOUR CONTRACTOR.

Tax lien sale

In a tax lien sale, instead of selling the actual property, the governmental entity sells a lien on the property. The lien is generally for the amount of delinquent taxes, accrued interest, and costs associated with the sale.

Involuntary

Involuntary liens are placed on property by law, without consent of the owner. Example: - tax assessor placing an involuntary lien on a property of an absentee landlord who was not notified of a past-due tax bill. - vendor and mechanical liens

GENERAL LIENS

May affect all of the properties held by a debtor in the county. Types of general liens include: Judgment lien Income tax lien Estate tax lien

Vendor's lien:

Sometimes, a seller will allow a buyer to use a purchase-money mortgage if the buyer does not have sufficient funds for the down payment. In this case, the buyer is the vendee, and the seller is the vendor. As a vendor, the seller places a lien on the land in the amount of the purchase-money mortgage. - if not paid, it can force the sale (foreclosure) - is an equitable lien - is for the portion of the sale price remaining unpaid PRIORITY: DATE OF RECORDED OF THE PURCHASE-MONEY MORTGAGE.

Special Assessment Liens

Special assessments they become liens immediately as soon as the assessment is complete. EX: - are based strictly upon the concepts of "need" and "benefit." if they increase the value of the property. - delinquent utility billings - imposed against lands when drinking water lines are installed - when sewer lines are installed; or when streets are paved with concrete - they apply only to Real estate and not Real property PRIORITY: IMMEDIATELY BECOME LIEN (once the assessment is complete)

Federal Income Tax lien (IRS):

The lien allows the (IRS) to secure or otherwise requisition the taxpayer's property in order to secure payment. Federal tax liens can be assessed for unpaid taxes of any kind, including income, self-employment, gift or estate taxes. - they - it downgrade one's credit score, - sometimes lien must be paid off in full before the taxpayer can obtain financing - has priority over all other liens—even a mortgage filed before the taxes became due - An investor may buy a tax lien from the government.

Voluntary

Voluntary liens are placed against the property by the owner to secure payment of a long term debt such as a mortgage or home equity loan.

Special Assessment definition

When governmental unit may demand from property owners to fund a public project which creates a "benefit" in properties lying within a special geographic area - are due and payable with your real estate property taxes

Estate tax lien:

When someone dies, federal estate tax liens are automatically imposed against his or her assets. - don't require recording

Property Tax Lien

is a lien imposed by law upon a property to secure the payment of taxes. A tax lien may be imposed for delinquent taxes owed on real property PRIORITY: IMMEDIATELY BECOME LIEN

Tax certificate

represents the unpaid delinquent real property taxes, non-ad valorem assessments, interest, and related costs and charges for a specific parcel of property. Every year, tax collectors sell tax certificates to the general public at a public auction or an online sale open to the public.