Foreclosure

Question 1

the right of redemption states

Answer 1

that the borrow in default can repay the delinquent payments and

Question 2

borrow’s statutory right of redemption states

Answer 2

that a borrower has a 10 day period after the property being sold at auction to repay and regain

Question 3

the Duties of a Mortgagor

Answer 3

Some of the most common triggers for foreclosure are not keeping up with mortgage payments, not keeping the property in good repair, not paying for homeowner’s insurance, and not paying property taxes.

Question 4

right to transfer the mortgage states

Answer 4

the lender has the right to sell the mortgage to another lender

Question 5

A deficiency judgment is

Answer 5

a court’s decision to attach a judgment (lien) against a debtor in the event that a property’s sale price does not cover outstanding debts, meaning the lender can go after the borrower for more money after the house is sold. 😱

Question 6

What are the three categories of foreclosure?

Answer 6

judicial, nonjudicial, and strict

Question 7

Nonjudicial foreclosure requires the presence of ________ in the security instrument (most likely, a deed of trust) at the time of signing.

Answer 7

a power of sale clause

Question 8

Upset Bid Period 🗓

Answer 8

As I mentioned earlier, there is a 10-day period following the foreclosure sale called the “upset bid period.” During this time, any bidder may place a higher bid on the property and “upset” the previous bid. Every time a bid upsets the previous bid, a new 10-day upset bid period begins. The borrower may also redeem the property, according to the right (equity) of redemption, during this period. After this 10-day period, the foreclosure sale is considered final and the title is transferred to the new owner.

Question 9

Strict Foreclosure

Answer 9

Instead, the lender files suit, asking the court to set a timeframe in which the borrower has to satisfy the debt through the exercise of their equitable right of redemption.

If the borrower fails to make payment and satisfy the loan in the prescribed time, the title is conveyed to the lender.

While this might sound harsh (or should I say strict?), realize that a strict foreclosure typically comes into play when the debt far exceeds the property value, making a foreclosure sale an unnecessary expense.

Question 10

does nc do strict foreclosure

Answer 10

no

Question 11

what comes first in debt priority

Answer 11

property taxes

Question 12

CFPB

Answer 12

U.S. agency ensuring fairness for consumers dealing with banks and lenders.

Question 13

The period before foreclosure when CFPB guidelines and rules come into play.

Answer 13

120-Day Window

Question 14

Servicer Duties - Contact & Notice

Answer 14

Loan servicers must make an effort to contact borrowers within 36 days and send a written delinquency notice by day 45.

Question 15

Special Forbearance

Answer 15

The lender works with the borrower by spreading out the past due amount over several future payments until the loan is brought current.

Question 16

deed in lieu of foreclosure means

Answer 16

an arrangement where you voluntarily turn over ownership of your home to the lender to avoid the foreclosure process.

Question 17

Chapter 13 Bankruptcy

Answer 17

Repayment plan lasting 3-5 years to eliminate debts, including the mortgage. Monthly payments to court trustee. Automatic stay stops collection actions.

Question 18

Chapter 7 Bankruptcy

Answer 18

Common form, swiftly eliminates unsecured debts through asset liquidation. Homeowners can keep property if they become current on mortgage.

Question 19

Chapter 11 Bankruptcy

Answer 19

Primarily for businesses. Reorganizes debt without asset sales. Not restricted by income or debt levels.