After defaulting on a mortgage prior to foreclosure, the mortgagor has the right to redemption. What is this right called?

Unlock all questions

This demo includes only 20 questions. Upgrade to access hundreds of questions, flashcards, exam simulations, and disable ads.

Full question bankExam simulationsFlashcards
From $24.99Unlock all

Study for the Gold Coast Class Test. Prepare with flashcards and multiple choice questions, each offering hints and explanations. Ace your exam!

Multiple Choice

After defaulting on a mortgage prior to foreclosure, the mortgagor has the right to redemption. What is this right called?

Explanation:
Equity of redemption is the borrower’s right to reclaim the property by paying off the mortgage debt, plus interest, costs, and any other amounts due, before the foreclosure sale occurs. This restores the loan to its pre-default status and stops the foreclosure, because the lien is satisfied and ownership returns to the borrower. It isn’t about canceling a contract (that would be a rescission), nor about the lender’s loan type (an equitable mortgage describes a type of mortgage, not a redemption right). Some jurisdictions also recognize the term “equitable redemption” to describe this same remedy.

Equity of redemption is the borrower’s right to reclaim the property by paying off the mortgage debt, plus interest, costs, and any other amounts due, before the foreclosure sale occurs. This restores the loan to its pre-default status and stops the foreclosure, because the lien is satisfied and ownership returns to the borrower. It isn’t about canceling a contract (that would be a rescission), nor about the lender’s loan type (an equitable mortgage describes a type of mortgage, not a redemption right). Some jurisdictions also recognize the term “equitable redemption” to describe this same remedy.

More Multiple Choice Questions
Subscribe

Get the latest from Examzify

You can unsubscribe at any time. Read our privacy policy