Which lien has the lowest priority for collection?

Prepare for the North Carolina Broker Reciprocal Exam. Sharpen your skills with flashcards and multiple-choice questions. Each question offers explanations to ensure clarity and understanding. Get ready to excel!

The unsecured court order lien holds the lowest priority for collection among the given options. Priority of liens is generally determined by the type of lien and the chronology of their recording. In this context, an unsecured court order does not have any collateral backing it and, therefore, ranks behind both secured liens, like a secured mortgage lien, and statutory liens, like tax liens, which are typically given priority for public revenue collection.

Secured mortgage liens have a substantial priority because they are tied directly to real property and are recorded with the intention of securing repayment of a loan. Tax liens are also given significant priority due to the government's right to collect taxes to fund public services. Pleas for compensation may vary in priority based on the legal context, but generally, they would not carry the same weight as the established liens mentioned.

When exploring lien priority, it is important to understand that secured interests protect creditors' rights more robustly than unsecured ones, making the unsecured court order the least favorable in terms of recovery during a liquidation or foreclosure scenario.

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