Real Estate Finance, Chapter 13

Short Sale A sale of encumbered property in which the mortgage lender accepts the net proceeds at closing in full satisfaction of a greater amount of mortgage debt.
Modification The act of redesigning an existing loan balance in order to avoid default or foreclosure. The loan period may be extended, payments reduced, or the interest rate adjusted to assist the distressed borrower.
The tax service Californians pay for tracks what? The tax service company tracks each property and notifies the lender if taxes are delinquent (Property Taxes)
Property taxes represent what? A priority lien over most existing liens on real estate
Which agencies direct lenders to extend to their borrower every possibility to avoid foreclosures? FHA and DVA, they are called workouts
When is the only time a foreclosure should be considered? The current market value of the collateral property is actually less than the balance of the indebtednessThe borrower can no longer make the payment
Deed in Lieu of Foreclosure A deed given by the mortgagor to the mortgagee when the mortgagor is in default under the terms of the mortgage. This is a way for the mortgagor to avoid foreclosure.
Foreclosure Not only a process to recover a lender’s collateral but also a procedure whereby a borrower’s rights of redemption are eliminated and all interests in the subject property are removed.
DVA foreclosures The lender receives only the top portion of the outstanding loan balance.
After a foreclosure of an FHA insured loan, the lender will receive compensation in the form of the balance owed plus costs.
The clause in a real estate loan that triggers a foreclosure in the event of a default is the Acceleration clause
Recasting a real estate loan involves all of the following activities except forgiving any delinquent payments.
A judicial foreclosure involves all of the following actions except strict forfeiture.

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