Maryland law recognizes both deeds of trust and mortgages as valid real estate security instruments. Which of the following statements about Maryland deeds of trust is NOT accurate?
Correct Answer
C) A deed of trust can only be foreclosed through a judicial court proceeding in Maryland
Option C is NOT accurate. In Maryland, a deed of trust can be foreclosed through a non-judicial trustee's sale — this is actually the primary advantage of using a deed of trust over a mortgage. The statement that it 'can only be foreclosed through a judicial court proceeding' is false; non-judicial foreclosure is available and is the most common method used for deed of trust defaults in Maryland.
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Related Topics & Key Terms
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Related Concepts
RESPA is a federal law that requires lenders to provide borrowers with information about settlement costs, prohibits kickbacks and referral fees, and limits escrow account deposits. It applies to federally related mortgage loans.
The secondary mortgage market is where existing mortgage loans are bought and sold between lenders, investors, and government-sponsored enterprises (GSEs) like Fannie Mae, Freddie Mac, and Ginnie Mae.
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.
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