Escrow & Title
A lis pendens recorded against a property provides notice that:
AThe property has a tax lien
BThere is pending litigation affecting the title to the property✓ Correct
CThe property is in foreclosure
DThe property has an environmental contamination issue
Explanation
A lis pendens (Latin for 'suit pending') is a recorded notice that there is a pending lawsuit that may affect title to the property. It puts prospective buyers and lenders on notice that the title could be affected by the outcome of the litigation.
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Key Terms to Know
Lien
A financial claim against a property that serves as security for a debt or obligation, giving the creditor the right to foreclose if unpaid.
Title InsuranceInsurance protecting against financial loss from defects in a property's title that existed before closing but were unknown at the time of purchase.
Abstract of TitleA condensed history of a property's title, summarizing all recorded documents and encumbrances affecting it from the earliest record to the present.
Private Mortgage Insurance (PMI)Insurance required by lenders on conventional loans with less than 20% down payment, protecting the lender — not the borrower — against default.
Math Concepts
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