Finance
In Iowa, a deficiency judgment after foreclosure allows the lender to:
AAutomatically claim additional properties owned by the borrower
BPursue the borrower personally for any remaining loan balance after the foreclosure sale✓ Correct
CIncrease the mortgage interest rate retroactively
DFile criminal charges for non-payment
Explanation
If the Iowa foreclosure sale proceeds do not satisfy the full outstanding loan balance, the lender may seek a deficiency judgment against the borrower for the remaining amount, making the borrower personally liable.
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Key Terms to Know
Discount Points
Prepaid interest paid to a lender at closing to reduce the mortgage interest rate, with each point equal to 1% of the loan amount.
Private Mortgage Insurance (PMI)Insurance required by lenders on conventional loans with less than 20% down payment, protecting the lender — not the borrower — against default.
Pre-ApprovalA lender's conditional commitment to loan a specific amount to a borrower, based on verified income, credit, and assets.
Short SaleA sale of real property where the sale proceeds are less than the outstanding mortgage balance, requiring lender approval.
Math Concepts
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