Finance
What is the purpose of a 'Cancellation of Security Deed' in Georgia?
AA. To initiate foreclosure proceedings
BB. To release the lien and reconvey legal title to the borrower after the loan is repaid✓ Correct
CC. To cancel the purchase contract
DD. To transfer the debt to a new lender
Explanation
When a Georgia Security Deed loan is paid in full, the lender executes a Cancellation of Security Deed (or Deed of Conveyance) that releases the lien and reconveys legal title back to the borrower.
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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).
LienA financial claim against a property that serves as security for a debt or obligation, giving the creditor the right to foreclose if unpaid.
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.
Deed of TrustA security instrument used in many states instead of a mortgage, involving three parties: borrower (trustor), lender (beneficiary), and a neutral trustee.
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