A Massachusetts lender forecloses on a property by power of sale. The foreclosure sale generates proceeds of $385,000. The outstanding mortgage principal balance is $310,000. Accrued interest owed is $12,000. Attorney and publication costs for the foreclosure total $8,000. After all amounts owed to the foreclosing lender are satisfied, how much surplus will be available to the former borrower?
Correct Answer
B) $55,000
Step 1: Calculate total amounts owed to the lender: Principal $310,000 + Accrued interest $12,000 + Foreclosure costs $8,000 = $330,000. Step 2: Calculate surplus: $385,000 (sale proceeds) - $330,000 (total owed) = $55,000 surplus available to the former borrower.
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Related Topics & Key Terms
Key Terms:
Related Concepts
A trustee sale is a type of foreclosure where a trustee, appointed under a deed of trust, sells the property at auction to satisfy the debt.
Usury is the practice of charging an interest rate that exceeds the maximum rate permitted by state law. Usury laws protect borrowers from excessive interest charges on loans.
A VA loan is a mortgage guaranteed by the Department of Veterans Affairs available to eligible veterans, active-duty service members, and surviving spouses. It offers no down payment and no private mortgage insurance requirements.
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