Multiple choice questions related to basic
1. Which of the following is true about service providers' liens on personal property?
a.The liens attach with respect to any work performed on personal property that benefits the property regardless of the consent of the owner of the property.
b.They can exist only if provided for by statute.
c.Whether or not they are recorded, the lien will remain attached to the property if the debtor transfers the property to another.
d.Such a lien applies only to the reasonable value of the services provided.
2.What is a mortgage?
a.A loan to purchase a house or other real property.
b.A contract to purchase a house or other real property.
c.Any loan associated with real property.
d.A security agreement in which real property is pledged as collateral for the related debt.
3. How are mortgages and deeds of trust related to one another?
a.They are two different methods to give a lender a security interest in real property of the debtor.
b.They are two names for the same instrument, and thus can be used interchangeably.
c.They are two distinct aspects of a security agreement covering real property, both of which must be present for the security interest to be valid.
d.Mortgages are used for real property, and deeds of trust are used for personal property.
e.Mortgages are used to create a security agreement covering residential real property, and deeds of trust are used in connection with commercial real property.
4.Which of the following best describes how a deed of trust works?
a.The state gives a deed to the lender to hold until the borrower satisfies the debt.
b.The borrower gives a deed to the lender to hold until the borrower satisfies the debt.
c.When a party borrows money to purchase property, the seller holds the deed until the debt is paid off, at which point it will be conveyed to the borrower.
d.When a trust is the owner of real property, a special type of deed is required.
e.The borrower conveys a deed to a third party who holds legal title until the debt is paid off or the borrower defaults.
5.Under a land sales contract:
a.A third-party lender provides financing for the purchase of a piece of property.
b.Credit is extended directly by the seller to the buyer, with the buyer not receiving a deed from the seller until the debt obligation is fully satisfied.
c.Credit is extended directly by the seller to the buyer, with the buyer receiving a deed immediately and that will become null and void upon default.
d.Land is sold that will not involve the use of a mortgage or deed of trust.
6.A material person's lien can be obtained on real property by a contractor who has not been paid and who has:
a.Provided materials used on the real property.
b.Provided labor on the real property.
c.Provided materials used on the real property or labor on the real property.
d.Provided materials or labor used on personal property that was located on the real property at the time of providing the materials or labor.
e.C and D.
7.Jack has a construction company that specializes in home remodeling and renovation. He enters into a contract with Sandra to remodel her basement. Sandra agrees to pay in three installments, the third of which is due at the time of completion. Sandra makes the first two payments on schedule but refuses to make the final one even though the job has been completed. To preserve his rights, Jack files against the property. What type of filing has Jack most likely done?
a.A mechanic's lien.
b.A mortgage.
c.A deed of trust.
d.A deficiency judgment.
e.A foreclosure.
8.What does it mean for liability on a negotiable instrument to be secondary liability?
a.The liability is for a small amount.
b.The liability arises only if the party with primary liability defaults and does not pay.
c.There are two parties to share the secondary liability.
d.It means that the liability relates to a two-party negotiable instrument.