Finance
Maine's Homestead Protection Act exempts a primary residence from certain creditor claims up to a specified dollar amount. This exemption CANNOT protect against:
ACredit card debts
BMortgage liens, property tax liens, and mechanics liens on the homestead✓ Correct
CMedical debts
DStudent loans
Explanation
Maine's homestead exemption protects equity in a primary residence from general creditors but does NOT protect against mortgage liens, property tax liens, or mechanics liens directly attached to the property.
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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.
Loan-to-Value Ratio (LTV)The ratio of a mortgage loan amount to the appraised value or purchase price of a property, expressed as a percentage.
Discount PointsPrepaid interest paid to a lender at closing to reduce the mortgage interest rate, with each point equal to 1% of the loan amount.
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
State-Specific Concepts
Homestead ExemptionMechanic's Lien
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