A New Jersey real estate licensee is explaining the state's foreclosure process to a first-time buyer. Which of the following statements about New Jersey foreclosure is NOT accurate?
Correct Answer
D) A lender may use a trustee's sale to foreclose more quickly if the mortgage includes a power-of-sale clause
The statement that a lender may use a trustee's sale with a power-of-sale clause is NOT accurate in New Jersey. New Jersey is a strictly judicial foreclosure state. Power-of-sale clauses and trustee's sales are features of non-judicial foreclosure states (deed-of-trust states). In New Jersey, all foreclosures must go through the court system regardless of any mortgage clause, and there is no trustee's sale mechanism.
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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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