Which of the following describes a lien placed to secure payment of labor or materials provided for property improvement?

Study for the Arizona Real Estate Exam. Boost your knowledge with flashcards and multiple choice questions with explanations. Be exam-ready with our comprehensive review!

A mechanic's lien is specifically designed to secure payment for labor or materials provided in the improvement of a property. This type of lien is typically utilized by contractors, subcontractors, or suppliers who have not been paid for their work or materials. When a contractor performs work on a property and does not receive compensation, they can file a mechanic's lien, which attaches to the property and serves as a claim against it. This ensures that the contractor has a legal right to seek payment by potentially forcing the sale of the property if necessary.

In contrast, a judgment lien arises from a court decision and is typically related to a debt or monetary judgment against an individual. A federal tax lien is imposed by the government when a taxpayer fails to pay federal taxes, representing a claim against the taxpayer's property. A mortgage lien, on the other hand, is a security interest created when a borrower receives a loan to purchase property, allowing the lender to claim the property if the loan is not repaid. Each of these liens serves different purposes, but a mechanic's lien is uniquely tied to the construction and improvement of real property.

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