Mortgages Flashcards
Name the types of mortgage alternatives.
Absolute deed
Sale-leaseback
Installment land contract
Deed of trust
Equitable vendor’s lien
What are the ways to avoid foreclosure?
Equitable redemption: Mortgagor pays full amount of outstanding debt (as increased by acceleration clause) plus any accrued interest; must take place BEFORE foreclosure sale
Deed in lieu of foreclosure: Mortgagor conveys all interest in mortgaged property to mortgagee, as long as both parties agree
Renegotiating debt: Parties renegotiate terms of promissory note and mortgage
Note: Many states also recognize a statutory right of redemption that permits a mortgagor to reclaim the property AFTER a foreclosure sale.
Priorities
Obligatory payments under a senior future-advances mortgage have priority over amounts loaned by a junior lender, even if the senior mortgage’s obligatory payments are paid out after the junior lender remits its loan amount and records its lien.
