Chapter 15 Review: Mortgage Clauses Flashcards
If the borrower defaults, the _________ clause allows the lender to call the entire balance due
acceleration
When the borrower voluntarily sells his property to someone else, according to the _______ or due-on-sale clause the borrower must pay off the entire loan
alienation
A subordinate loan is one that is NOT in ____ position should the borrower default
first
According to the _________ clause, once the borrower makes his final payment the lender no longer has an interest in the property
defeasance
When a buyer assume the mortgage of the seller, this new buyer is ____________ for the payment of the mortgage
primarily liable
When a buyer purchases a property subject to the mortgage, the ______________ is primarily liable for the payment of the debt
original borrower
The mortgagor (homeowner) owns the property in a _________ state
lien theory
The lender has title to the property in a title theory state. When the borrower makes his final payment, the trustee re-conveys the deed to the borrower using a deed of
reconveyance
In an _________________ state, the lender has a lien interest in the property unless the borrower defaults
intermediate theory
Under ________ foreclosure, the lender files suit to gain title to the property; the lender may then sell the property to recover what it is owed
judicial
Under __________ foreclosure, the lender has the power to sell the property without filing a lawsuit against the borrower who is in default
non-judicial
The borrower can stop the foreclosure process through his equitable right of _________ by paying the amount owed plus interest and costs
redemption
A deficiency judgment is a _______ judgment against the defaulted borrower
personal
Income overstatement, occupancy misrepresentation, and down payment misrepresentation are all examples of
mortgage fraud
When a lender uses deceptive practices to induce someone to borrow money, it is called
predatory lending
