National Real Estate Practice Exam

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What does a lis pendens indicate?

A completed real estate transaction
A pending lawsuit affecting property rights
A warning of possible property tax liens
A notice of property inspection

The correct answer is: A pending lawsuit affecting property rights

A lis pendens is a legal term that translates to "litigation pending." It serves as a public notice that there is a pending lawsuit that may affect the ownership or rights to a particular piece of real estate. When a lis pendens is filed, it effectively alerts potential buyers or interested parties that the property is subject to ongoing legal proceedings, which may impact their ability to obtain clear title to the property. This makes it crucial for anyone considering a transaction involving the property to be aware of the lawsuit and the potential implications it could have on their rights in the future. The function of a lis pendens is specifically to inform parties about the legal claim against the property, thereby ensuring that they are fully aware of any issues before proceeding with a transaction.