The following text introduces the area of debt and the remedies available to creditors.

Read the text, then match the three main types of liens (1-3) with their

Explanations (a-c).

Consensual lien

Judicial lien

Statutory lien

A a lien created as the result of a legal process

B a lien created by agreement between the parties

C a lien created by legislation governing the

Relationship between debtor and creditor

Debtor-creditor is the area of the law debtors and

Creditors. The law outlines what happens make

Payments and what remedies are available to the creditor not focus on

The creation of the of the debtor-creditor

Relationship.

With this mind,

Not have the resources to make payment. determined

has some type of 'favoured status'. Broadly speaking, creditors

Means, either by lien or by priority.

There are three different types of liens: consensual, judicial and statutory. A consensual lien is

One which is created upon agreement between the debtor and creditor. Usually, this type of lien

Must be perfected through some type of registration process order to be against third

Parties (e.g. other creditors seeking payment from the debtor from Examples

Of these types of liens would be mortgages and registered security interests. Mortgages are liens

Created in land, whereas security interests are generally related to other types of property. Judicial

Liens arise as a result of some sort of judicial proceedings brought by the creditor to secure an

interest in the debtor's property. Examples lien include attachment liens,

Garnishment, judgment liens and execution liens. seizure of the

debtor's property by a public official (such as enforce the debtor.

Statutory liens are liens created by legislation due to the economic between the

debtor ar1d creditor. Common examples of this type of lien are tax liens and mechanic's liens. In

Some cases, perfection of this type of lien required in order to be valid against third parties.

Priority becomes an issue when the debtor is unable to make payment of when they

Become due and a group of creditors take action secure payment of their particular claim.

Most commonly, creditors bring some course of insolvent

liquidationl proceedings. In such a circumstance, usual gather the debtor's

Property and to distribute it among the creditors. When there property to go

Around, the law has a system under certain creditors are paid before others.

Most of the rules that apply are first-in-time rules related to different classes of

Creditors. Examples of priority creditors would be wage earners, collectors.

Other creditors are usually subject to

US) involuntary bankruptcy

The majority of not have any favoured status, either by lien or priority. These

Creditors are often referred to as general creditors. the context of group actions, these

creditors generally end debtor's property. In order for

These creditors to have to bring an action to attain

The status of lien creditor.

e

Match these types of liens (1-8) mentioned in the text with their explanations

(a-h). You may need to consult the glossary.

Attachment lien

Execution lien

Garnishment

Judgment lien

5 mechanic's lien

Mortgage

Security interest

Tax lien

Date: 2015-12-11; view: 1037