Amanda's share loan lender requires her to obtain an assignment of the proprietary lease as part of the loan security. What does this assignment accomplish for the lender?
Correct Answer
D) It enables the lender to step into Amanda's position and enforce lease rights if she defaults
Assignment of the proprietary lease allows the lender to step into the borrower's position regarding lease rights and obligations. If Amanda defaults, the lender can enforce the lease terms, continue paying maintenance fees, and ultimately transfer the lease to a new buyer during foreclosure proceedings.
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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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