Real Estate Mortgage: Unit 3 Flashcards

Real Estate Mortgage: Unit 3 Flashcards

What clause cancels the lenders interest in the property when the loan is repaid defeasance BankruptcyA legal proceeding that relieved a debtor of the responsibility of paying debts or provides protection while attempting to repay debts DefaultFailure to fulfill an obligation, duty, to promise, as when a borrower fails to make payments, a tenant fails to pay rent, or a party fails to preform a contract. Mortgage, note, or other document will define what constitutes default Satisfaction of MortgageThe document a mortgagee gives to the mortgagor when a mortgage debt has been paid in full, acknowledging that the debt has been paid and the mortgage is not longer a lien against the property To ensure a mortgage recorded at a later date will take priority over an earlier mortgage, a subordination clause is used true Subordination ClauseThis contract gives a mortgage recorded at a later date the right to take propriety over an earlier recorded mortgage What type of clause allows the lender to sell the property to pay debt the borrower owned without going through the courts?Power of sale clause What type of legal clause in a trust deed authorized that the creditor may begin a non judicial foreclosure action if a borrower defaults power of sale clause Forclosure Actiona lawsuit filed by a creditor to begin foreclosure proceedings Deficiency judgements is another term for judicial foreclosure False, it is a personal judgement against the borrower and requires a separate court action if the foreclosure sale of the property does not bring enough money to pay off the mortgage Alienation clauselimits borrowers right to transfer property prepayment clauselender can charge fee if borrower pays off loan early Alienation ClauseThis contract clause gives the lender certain stated rights when there is a transfer of ownership in the property A statement that you have 60 days to occupy a property and must live in the property for at lease one year is an example of a defeasance clause False, that is an occupancy clause A borrower who declares bankruptcy is required to go through a judicial foreclosure False Power of sale clauseThis contract clause allows the lender to sell the property to pay the debt the borrower owes without going through the

courts

What clause gives a lender the right to declare the entire loan balance due immediately because of borrower default or for violation of other contract provision Acceleration clause Sheriffs Salea foreclosure sale held after a judicial foreclosure Statutory RedemptionThis lets a mortgagor redeem property for a set period of time after a foreclosure sale, regardless of the timing of other events. Time frames for statuary right of redemption vary by state Accelerated ClauseThe contract clause allows the lender the right to declare the entire loan balance due immediately because of the borrower deflate or for violation of other contract provisions A lender has the right to enforce the acceleration clause in a mortgage when the borrower is behind by one payment A debtor who is required to pay an extra 3% of the total loan amount if more than 20% of the principal is repaid during the first five years of the term is bound to these terms under prepayment clause Power of sale clauselender can sell property without going through courts Open mortgagea way to describe a mortgage that can be prepaid at any time without penalty. Most mortgages today are open mortgages except for refinance mortgages Prepayment Clausea clause in a contract which gives a lender the right to charge the borrower a penalty for paying off loan early Cathy has a mortgage with an aliention clause. She sells her property to John to assume her loan. The alienation clause gives the lender the right to call for the entire loan balance to be paid off at the transfer Foreclosure, JudicialA lawsuit filed by a lender or other creditor to foreclose on a mortgage or other lien; a court ordered sheriffs sale of the property to repay the debt