Chapter 9: security interests

Question 1

Mortgage

Answer 1

Mortgage is a collaterization of property.
When the bank gives a loan, the mortgage is the security device that protects the bank. If a borror fails to pay, the bank can possess the house.
When the bank gives a loan, the buyer signs a mortgage (the collateral) and a promissory note.

Question 2

Equity of redemption

Answer 2

any time before a home is sold in a foreclosure, the buyer has a right to come to redeem his property

Question 3

Statutory right of redemption

Answer 3

allows the homeowner tog et the property back even after a sale.(not every jurisdciton)

Question 4

Deed of trust

Answer 4

legal property is placed in one or more trustees, to secure the payment of a sum of money.

Question 5

Priority of creditors

Answer 5

priority for which creditor first collects the money from the foreclosure sale to get back the money they originally loaned to the landowner

Question 6

purchase money mortgage

Answer 6

mortgage in which the loan was used to purchase the property

Question 7

Second mortgage

Answer 7

Used for remodeling/upgraded

Question 8

Doctrine of abandonment

Answer 8

There can be abandonment only in a case where the title is imperfect, or less than absolute or where the abandonment is accompanied by circumstances of estoppel + Limitations (No applications to a fee simple)

Question 9

Matters of personal liability

Answer 9

Deals with legal consequences that flow from a foreclosure sale when the sale proceeds are not sufficient to pay off the mortgage (or deed of trust) or if a landowner sells their home while having a mortgage/deed of trust.