Property Ownership
In a New York foreclosure action, what is the 'equity of redemption'?
AThe borrower's right to redeem the property after the foreclosure sale
BThe borrower's right to pay off the debt and reclaim the property before the foreclosure sale is completed✓ Correct
CThe lender's right to deficiency judgment
DThe government's right to purchase the property at the foreclosure sale
Explanation
The equity of redemption is the mortgagor's right to redeem (pay off) the mortgage debt and reclaim the property at any time before the foreclosure sale is confirmed by the court. In NY, there is generally no statutory right of redemption after the sale.
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Key Terms to Know
Lien
A financial claim against a property that serves as security for a debt or obligation, giving the creditor the right to foreclose if unpaid.
Title InsuranceInsurance protecting against financial loss from defects in a property's title that existed before closing but were unknown at the time of purchase.
ContingencyA condition in a purchase contract that must be satisfied before the sale can proceed to closing.
Purchase AgreementA legally binding contract between a buyer and seller that outlines the terms and conditions of a real estate sale.
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