Escrow & Title
A Minnesota property is being sold in a 'short sale' where the lender must approve the sale price (which is less than the mortgage balance). The lender's approval is required because:
AThe lender owns the property in a short sale
BThe lender must agree to release their lien for less than the full balance✓ Correct
CShort sales automatically require HUD approval
DMinnesota law requires lender consent for all property sales
Explanation
In a short sale, the lender must agree to release their mortgage lien for less than the full amount owed. Without lender approval, the property cannot be conveyed free and clear of the mortgage lien. Lenders review short sale offers to determine if accepting the short sale is better than foreclosing. Minnesota short sale timelines can be lengthy due to the lender approval process.
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