Legal Flashcards
1
Q
What is a foreclosure on property
A
More drastic than a Power of Sale as it means suing the borrower for both possession of the property AND repayment of the debt
2
Q
When is foreclosure usually used
A
when the value of the property is less than the debt owed and the lender is willing to sit on the property until value increases
3
Q
Can a borrower regain possession of a property during foreclosure
A
If the borrower can raise adequate funds, he or she can regain possession during period of time
4
Q
What happens if borrower can’t get adequate funds to regain possession of the property from lender pursuing foreclosure?
A
- clear titled is granted to lender;
-the lender is no longer accountable to borrower for the property;
-any profit on sale after the Final Order belongs wholly to the lender;
-the lender cannot recover any loss from the mortgagor unless the lender had previously launched a separate suit under the mortgagor’s covenant to cover these losses.
