Finance
Michigan is a 'lien theory' state, meaning:
AThe lender holds title to the property until the loan is repaid
BThe borrower retains title and the lender holds only a lien (security interest) against the property✓ Correct
CTitle passes to a trustee during the loan term
DThe state holds a lien on all mortgaged property
Explanation
Michigan follows lien theory: the borrower retains title to the mortgaged property, and the lender holds a lien (the mortgage) as security. This differs from title theory states where legal title passes to the lender.
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