Foreclosure Flashcards
Deed in Lieu of Forclosure
A mutual agreement in which the borrower is released from liability under the terms of the loan in exchange for a quitclaim deed or a regular grant deed
Forebearance
An agreement that effectively forestalls or delays foreclosure action
Foreclosure
A procedure that removes an owner’s property rights; when real property is pledged as security for a loan, process of selling that property because borrower defaulted
Grant Deed
Deed that contains two guarantees; grantor states that property has not been sold, and state the property is not burdened by encumbrances apart from those already disclosed to the buyer
Loss Mitigation
Negotiation of mortgage terms between lender and borrower that prevent foreclosure
Quitclaim Deed
A deed to relinquish any interest in property that the grantor may have, but implying no warranties
Short Sale
A situation in which the lender agrees to accept a payoff-in-full amount less than the outstanding balance of the loan
Affidavit of Completion of Forfeiture
A written statement recorded by a vendor that terminates a buyer’s interest when the buyer defaults on a land contract
Certificate of Sale
A document issued to the highest bidder at a judicial foreclosure sale
Deficiency Judgment
A judgment against the defaulting mortgagor for the difference between the indebtedness and the sale price through a foreclosure sale
Equity of Redemption Period
Right to redeem property during the foreclosure period
Forcible Detainer Action
Expedites eviction of the borrower
Forfeiture Clause
Loss of money or anything of value due to failure to perform under a contract
Judicial Foreclosure
A foreclosure action taken through the filing of a lawsuit
Land Contract
Also known as an agreement for sale or a contract for deed, it is an executory contract, in as much as the terms have not been fulfilled
Lis Pendens
A recorded legal document that gives constructive notice that an action affecting a particular piece of property has been filed in a state or federal court
Nonjudicial Foreclosure
The foreclosure and sale of property without resorting to court action
Notice of Default
A notice that is recorded in the county recorder’s office stating that a trust deed is in default and that the holder has chosen to have the property sold
Notice of Election to Forfeit
A notice recorded by the seller at the end of the reinstatement period of a breached land contract
Notice of Reinstatement
A notice recorded by the seller if the buyer cures the default during the 20-day period after the filing of the notice of election to forfeit
Period of Reinstatement
90-day period from the notice of default, during which a borrower may reinstate the loan secured by a deed of trust by making all back payments plus costs and bringing the loan current, but is not required to pay off the entire loan balance
Power of Sale Clause
Clause in a deed of trust that allows the trustee to conduct a foreclosure sale without first going to court
Reinstatement Period
A right available to anyone under an accelerated promissory note secure by a deed of trust or mortgage on property. Debtor has up to 3 months to pay off amount in arrears including all costs curing the default without additional penalty
Sheriff’s Deed
After the statutory period of redemption, the successful bidder at a judicial foreclosure receives this deed and may take possession of the property
Sheriff’s Sale
A sale ordered by the court in which a sheriff or county official has the legal right to sell a distressed or foreclosed property
Statutory Period of Redemption
Period after the sale during which the landowner could redeem the property
Trustee Deed
The deed issued by the trustee after the foreclosure and sale of property under a deed of trust
