Foreclosure Flashcards
Lien Theory States
The mortgagee/lender cannot take possession prior to foreclosure because lender has a lien until foreclosure is complete
The mortgagor is the owner up until foreclosure
Title Theory State
The lender technically has the right, as the holder of title, to possess the property at anytime
Intermediate title theory state
The mortgagor retains title until default, at which point the lender can take possession
Equity of Redemption
A common law right held by the mortgagor to reclaim title and prevent foreclosure upon the full payment of debt
Deed in Lieu of foreclosure
Rather than face foreclosure, the mortgagor can convey the property to the lender in exchange for releasing her from any outstanding debt.
Foreclosure
Forced sale of an asset to pay off a debt
Notice
The mortgagee must give notice before foreclosing
Two methods of foreclosure
- Judicial Sale
- Power of sale
Judicial Sale
sale under supervision of a court
Power of sale
Sale held by mortgagee/lender
