A California buyer defaults on a Cal-VET loan after making payments for 8 years. What remedy does the California Department of Veterans Affairs have that differs from a conventional lender's remedy?
Correct Answer
B) The state can cancel the land contract and recover the property without a formal foreclosure proceeding
Because Cal-VET uses a land contract (contract of sale) rather than a deed of trust, the state holds legal title throughout the loan term. If the veteran defaults, the state can cancel the contract and recover the property without going through the formal foreclosure process, since the state already holds title.
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