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A contractor is building a patio. A lumber company delivers bricks on July 1, and work begins that same day. Work is completed on August 15. The contractor is paid for labor and materials on September 1. Ten days later, the contractor goes bankrupt without paying the lumber company. The lumber company records a mechanic's lien on the property as of September 4. The mechanic's lien is effective as of:
A. July 1
B. August 15
C. September 1
D. September 4
A. July 1
All of the following statements regarding a mechanic's lien is correct EXCEPT:
A. it must be recorded
B. it can be for labor only
C. it can be for materials only
D. it can be filed and collected at any time
D. it can be filed and collected at any time
To be effective, a mechanic's lien for work performed by a subcontractor must be recorded within:
A. 120 days from the beginning of work
B. 120 days from the completion of work
C. 90 days from the beginning of work
D. 90 days from the completion of work
B. 120 days from the completion of work
Mechanic's liens take priority as of the date the:
A. work begins
B. lien is recorded
C. work is completed
D. foreclosure begins
A. work begins
A firm supplies materials which are used in the construction of a building. If they are NOT paid, the firm can record a(an):
A. judgment
B. attachment
C. lis pendens
D. mechanic's lien
D. mechanic's lien
A contractor performs work authorized by a lessee. The contractor can place a lien against the:
A. property itself
B. lessee's interest
C. lessor's interest
D. lender's interest
B. lessee's interest
A Homestead Exemption protects an owner's equity from foreclosure due to nonpayment of a recorded:
A. judgment
B. mortgage
C. land contract
D. deed of trust
A. judgment
What type of residences can a person own which would give them the greatest advantage under the Arizona Homestead Exemption?
A. Primary residence
B. Vacation and primary residence
C. Vacation residence
D. Unlimited residences
A. Primary residence
For a mechanic's lien to be valid, the contractor must:
A. file a pre-lien notice within 20 days
B. begin a foreclosure within 1 year of recording the lien
C. record the lien within 120 days from the start of work
D. be licensed, bonded, and insured
A. file a pre-lien notice within 20 days
A preliminary title report reveals that a judgment is found on the property. To whom must the payoff be made?
A. The escrow officer who recorded the judgment
B. The escrow officer who pulled the title report
C. The attorney listed on the judgment
D. The listing broker
C. The attorney listed on the judgment
can file a mechanic's lien EXCEPT:
A. an architect who designed the guest house
B. a maintenance crew installing a drip system in the yard
C. a cleaning crew who cleans the premises twice a month
D. an electrician who rewired the house for ceiling fans
C. a cleaning crew who cleans the premises twice a month
Which of the following would terminate a Homestead Exemption?
A. The owner left the property for 30 days or more
B. The property became a rental
C. The property was owned by a family trust
D. The house became the owner's personal residence
B. The property became a rental
To make sure that the mortgage loan has a higher priority than a potential mechanic's lien:
A. the lender should record the mortgage prior to the mechanic's lien being recorded
B. the lender should record the mortgage prior to the beginning of work on the property
C. the loan must be for $750,000 or less
D. there must be a clause in the mortgage stating the mortgage has priority over mechanic's liens
B. the lender should record the mortgage prior to the beginning of work on the property
Which is NOT true of an HOA lien foreclosure?
A. It may occur if unpaid dues exceed $1,200
B. It may occur if dues are delinquent for more than one year
C. It is foreclosed through a trustee's sale
D. It is foreclosed through a court action
C. It is foreclosed through a trustee's sale
Who does NOT have the right to record a mechanic's lien?
A. A subcontractor who installed plumbing in a new office building
B. A contractor hired by a homeowner to build a pool
C. A subcontractor who installed tile in a homeowner's remodeled bathroom
D. A subcontractor who upgraded the electrical panel on a rental home
C. A subcontractor who installed tile in a homeowner's remodeled bathroom
A statement signed by a contractor by which the material supplier's claim or right to a lien is terminated is a:
A. subordination agreement
B. lien waiver
C. mechanic's lien
D. materialmen's lien
B. lien waiver
All of the following statements regarding IRS liens are true EXCEPT:
A. The lien priority is established when it is recorded
B. They may delay or prevent the closing of a sale
C. They expire after 7 years unless extended
D. They expire after 10 years unless extended
C. They expire after 7 years unless extended
A seller sells a property to a buyer and has repairs done 30 days before the close of escrow. The buyer obtains a new FHA loan and closes escrow. After the closing, the contractor files a mechanic's lien. Which is true?
A. The mechanic's lien may not be recorded
B. The FHA lender is in first position
C. The FHA lender is in second position
D. The mechanic's lien is in second position
C. The FHA lender is in second position
Which of the following is the proper order of occurrence regarding judgments?
A. Judgment, attachment, lis pendens
B. Judgment, lis pendens, attachment
C. Execution, attachment, judgment
D. Lis pendens, judgment, execution
D. Lis pendens, judgment, execution
What will NOT terminate a Homestead Exemption?
A. Selling the property
B. Moving out of the property
C. Buying other property
D. Renting the property
C. Buying other property
When would a person qualify for a Homestead Exemption?
A. When they have lived in the property two of the last five years
B. Upon taking ownership and moving in
C. Eighteen months after ownership
D. When they have sold other investment properties
B. Upon taking ownership and moving in
Charges levied against specific properties which are benefitted by public improvements are called:
A. costs
B. levies
C. assessments
D. property taxes
C. assessments
A mechanic's lien, once filed, is a valid lien on the subject property for how long?
A. 90 days
B. 60 days
C. 6 months
D. 1 year
C. 6 months
Arizona state law provides for which of the following regarding a mechanic's lien?
A. Extension of time for filing the lien by agreement
B. A 20-day preliminary notice
C. Filing within 60 days for the original contractor
D. Priority over mortgages and other liens, including property tax liens
B. A 20-day preliminary notice
A monetary judgment by the court is a(an):
A. involuntary lien on the personalty and realty of the subject debtor
B. voluntary lien on the personalty and realty of the subject
C. involuntary lien against the realty only of the subject debtor
D. voluntary lien against the personalty only of the subject debtor
A. involuntary lien on the personalty and realty of the subject debtor
When a person wishes to enforce a judgment, they would seek a:
A. lawsuit
B. right of redemption
C. notice of completion
D. writ of execution
D. writ of execution
Of these, which is MOST likely to be paid for with a special assessment?
A. New fire engine
B. New sports stadium
C. Sewer repair
D. Teacher's salaries
C. Sewer repair
The Homestead Exemption protects against:
A. voluntary liens
B. specific creditors
C. personal judgments
D. foreclosure
C. personal judgments
How much equity does the Homestead Exemption protect in a person's Arizona residence?
A. $50,000
B. $75,000
C. $100,000
D. $150,000
D. $150,000
A couple sells a property through a short sale, and the HOA dues have not been paid for over a year. Who is legally responsible to pay them?
A. The lender
B. The seller
C. The homeowners' association
D. The broker
B. The seller
A bankruptcy trustee determines that a homeowner has $200,000 in equity in their primary residence. If the property is sold through the bankruptcy, how much of the proceeds can the owner keep?
A. None
B. $50,000
C. $150,000
D. $200,000
C. $150,000
