Finance
What is the difference between recourse and non-recourse debt in real estate?
ARecourse debt is for commercial; non-recourse for residential
BRecourse debt allows the lender to pursue the borrower personally; non-recourse limits lender to the collateral only✓ Correct
CNon-recourse debt has lower interest rates
DRecourse debt requires personal guarantees only from co-signers
Explanation
Recourse debt allows the lender to pursue the borrower personally beyond the collateral if the property sale does not cover the debt. Non-recourse debt limits the lender's recovery to the collateral (the property) only.
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