When a New Jersey lender files a foreclosure complaint, it also records a document with the county clerk to provide public notice that the property is subject to pending litigation. What is this document called?
Correct Answer
C) Lis pendens
A lis pendens (Latin for 'suit pending') is a recorded notice filed with the county clerk at the outset of a foreclosure action in New Jersey. It serves as constructive notice to the public — including potential buyers and lenders — that the property is subject to pending litigation. Any person who acquires an interest in the property after the lis pendens is recorded takes that interest subject to the outcome of the lawsuit.
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Related Concepts
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.
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.
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