Which mortgage clause allows a lender to regain their investment if the borrower does not pay his payment?
subordination
.
Which mortgage clause allows a lender to regain their investment if the borrower does not pay his payment quizlet?
Which mortgage clause allows a lender to regain their investment if the borrower does not pay his payment?
subordination
.
When a mortgage is paid off what clause allows the lender to release the mortgage rates and issue a satisfaction piece?
A defeasance clause
is a mortgage provision that assumes that the borrower, once mortgage payments are met, will be given the title to the property. Defeasance goes into play when a mortgage is paid off in full.
When a mortgage is paid off what clause allows the lender?
A due-on-sale clause
is a provision in a loan or promissory note that enables lenders to demand that the remaining balance of a mortgage be repaid in full in the event that a property is sold or transferred.
Which clause protects a lender if he does not want the loan?
Which clause protects a lender if he does not want the loan to be assumed by another party?
Alienation Clause
: This is a clause in a promissory note and is also referred to as a “Due on sale Clause”. The entire balance of the loan becomes due and payable when the property is transferred. This prevents assumption.
What are the disadvantages of a contract for deed select two?
A disadvantage to the seller is that a contract for deed is frequently characterized by
a low down payment and the purchase price is paid in installments instead of one lump sum
. … The legal fees and time frame for this process will be more extensive than a standard Power of Sale foreclosure.
What is a disadvantage of real estate investment?
Real estate can be sound investment, and one that has the potential to provide a steady income and build wealth. Still, one drawback of investing in real estate is illiquidity:
the relative difficulty in converting an asset into cash and cash into an asset
.
How long does a mortgage company have to release a lien?
In most cases, the lien holder (the lender in this case) should send the release to be recorded
within 30-90 days
. If you aren't sure what the requirements are in your area, reach out to your real estate agent, title agent, or real estate attorney for guidance.
What does a lender use to help prequalify you for a mortgage?
Unlike prequalification, preapproval is a more specific estimate of what you could borrow from your lender and requires documents
such as your W2, recent pay stubs, bank statements and tax returns
. The lender will then use these documents to determine exactly how much you can be preapproved to borrow.
How do you know if your mortgage is satisfied?
How do you get a Satisfaction of Mortgage? A Satisfaction of Mortgage is
issued by the lender after they have received the final mortgage payment from the borrower
. It's signed by the mortgagee (in the presence of a witness in some states and counties) and then notarized by a registered notary public.
What triggers an acceleration clause in a loan agreement?
An accelerated clause is typically invoked
when the borrower materially breaches the loan agreement
. For example, mortgages typically have an acceleration clause that is triggered if the borrower misses too many payments. Acceleration clauses most often appear in commercial mortgages and residential mortgages.
Why is an acceleration clause important to a lender 3?
An acceleration clause
allows the lender to require payment before the standard terms of the loan expire
. Acceleration clauses are typically contingent on on-time payments. Acceleration clauses are most common in mortgage loans and help to mitigate the risk of default for the lender.
What acceleration clause requires the borrower to pay off the entire mortgage debt when the property is sold?
A due-on-sale clause, also known as an alienation clause
, is a loan stipulation that requires a borrower to pay the entire loan balance if the property is being sold.
What Lien has the highest priority?
A general rule in property law says that
whichever lien is recorded first in the land records
has higher priority over later-recorded liens. This rule is known as the “first in time, first in right” rule.
What is a real estate release clause?
A release clause is a term that refers
to a provision within a mortgage contract
. The release clause allows for the freeing of all or part of a property from a claim by the creditor after a proportional amount of the mortgage has been paid.
Which clause is a benefit to the borrower and not to the lender?
An alienation clause
protects the lender from unpaid debt by the original borrower. It ensures that a creditor is repaid in a more timely manner if a borrower has issues with their mortgage payments and is unable to pay.
