Finance
In Minnesota, a short sale occurs when:
AThe property is sold within 30 days of listing
BThe sale proceeds are insufficient to pay off the mortgage, and the lender agrees to accept less than the full balance owed✓ Correct
CThe seller accepts an offer below the list price
DA property is sold at auction for less than market value
Explanation
A short sale is when the lender agrees to accept less than the full mortgage balance as payment in full, allowing the property to be sold for less than the debt. Short sales in Minnesota require lender approval and may have tax implications (forgiven debt may be treated as income). They are an alternative to foreclosure.
Related Minnesota Finance Questions
- Under the Real Estate Settlement Procedures Act (RESPA), which of the following practices is prohibited?
- A Minnesota buyer receives a seller concession of 3% of the purchase price to help with closing costs. On a $340,000 home, how much is the seller concession?
- The debt-to-income (DTI) ratio that most conventional loan programs use as a guideline for qualifying borrowers is generally no more than:
- Under RESPA, a lender is prohibited from:
- Private mortgage insurance (PMI) is typically required when the buyer's down payment is:
- A 'due on sale' clause in a Minnesota mortgage requires:
- An amortized mortgage in Minnesota is one where:
- The annual percentage rate (APR) on a Minnesota mortgage is higher than the interest rate because:
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