A Maine real estate instructor is reviewing mortgage instruments with a class of associate broker candidates. She lists several characteristics of Maine's mortgage and foreclosure system. Which of the following is NOT an accurate characteristic of Maine's mortgage instrument and foreclosure framework?
Correct Answer
D) Maine lenders may use a power-of-sale clause to conduct non-judicial foreclosure sales
Option C is NOT accurate. Maine does not permit non-judicial foreclosure through a power-of-sale clause. Maine is a judicial foreclosure state under 14 M.R.S. §§ 6321–6325, meaning all mortgage foreclosures must proceed through the court system. Power-of-sale clauses, which allow lenders to sell property without court involvement, are used in deed-of-trust states and are not a valid foreclosure mechanism in Maine.
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Related Topics & Key Terms
Key Terms:
Related Concepts
Discount points are upfront fees paid to a lender at closing to reduce (buy down) the interest rate on a mortgage loan. One point equals 1% of the loan amount and typically reduces the rate by approximately 0.25%.
An FHA loan is a mortgage insured by the Federal Housing Administration that allows lower down payments and credit scores than conventional loans. It is designed to help first-time homebuyers and borrowers with limited resources.
A fixed-rate mortgage has an interest rate that remains constant for the entire term of the loan, resulting in equal monthly principal and interest payments throughout the life of the mortgage.
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