Escrow & Title
Which of the following describes a 'deed in lieu of foreclosure' in Connecticut?
AThe borrower sues the lender to stop foreclosure
BThe borrower voluntarily transfers title to the lender to avoid the formal foreclosure process✓ Correct
CThe lender accepts a short sale of the property
DThe borrower files for bankruptcy to delay foreclosure
Explanation
A deed in lieu of foreclosure is a voluntary transfer of title from the borrower to the lender to satisfy the debt and avoid foreclosure. Both parties typically benefit: the borrower avoids foreclosure on their credit record; the lender avoids the cost of foreclosure.
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