A borrower in Anne Arundel County defaults on a home loan secured by a deed of trust. The lender wants to recover the property as quickly and efficiently as possible. Which foreclosure method is most commonly used in Maryland for deed of trust defaults?
Correct Answer
C) Non-judicial foreclosure through a trustee's sale under the deed of trust
Maryland allows both judicial and non-judicial foreclosure, but non-judicial foreclosure through a trustee's sale is by far the most common method used when the security instrument is a deed of trust. Because the trustee already holds legal title, the trustee can conduct a sale upon default without a full court proceeding, making the process faster and less expensive for the lender.
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Related Topics & Key Terms
Key Terms:
Related Concepts
TILA is a federal law that requires lenders to disclose the true cost of credit to borrowers, including the annual percentage rate (APR), total finance charges, and loan terms. It is implemented by Regulation Z.
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.
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