Finance
A 'due-on-sale' clause in a Louisiana mortgage requires:
AThe buyer to pay all closing costs
BThe loan to be repaid in full when the property is sold✓ Correct
CThe seller to pay off all liens before listing
DThe lender to provide a new appraisal upon sale
Explanation
A due-on-sale clause requires the mortgage to be paid in full when the property is sold or transferred. It prevents the buyer from assuming the seller's mortgage without lender approval.
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Key Terms to Know
Closing Costs
Fees and expenses paid by the buyer and/or seller at the closing of a real estate transaction, in addition to the property's purchase price.
Discount PointsPrepaid interest paid to a lender at closing to reduce the mortgage interest rate, with each point equal to 1% of the loan amount.
AppraisalA professional estimate of a property's market value prepared by a licensed or certified appraiser.
LienA financial claim against a property that serves as security for a debt or obligation, giving the creditor the right to foreclose if unpaid.
Math Concepts
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