Escrow & Title
In Florida, when property is sold at a foreclosure auction and no one bids more than the lender's opening bid, the lender receives a:
ADeed in lieu of foreclosure
BCertificate of title and takes ownership of the property (REO — Real Estate Owned)✓ Correct
CSecond mortgage on the remaining deficiency
DLender's priority certificate
Explanation
When a Florida foreclosed property is sold at auction and no bidder exceeds the lender's opening bid (typically the outstanding debt), the lender becomes the winning bidder by default and receives a certificate of title. The property then becomes 'Real Estate Owned' (REO) or 'bank owned.
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Key Terms to Know
Deed
A written legal instrument used to transfer ownership of real property from one party (grantor) to another (grantee).
Chain of TitleThe sequential record of all transfers of ownership for a piece of property from the original patent holder to the present owner.
Short SaleA sale of real property where the sale proceeds are less than the outstanding mortgage balance, requiring lender approval.
Debt-to-Income Ratio (DTI)A lender's measure of a borrower's monthly debt obligations relative to their gross monthly income, used to evaluate loan eligibility.
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