John Williams owns a property in Syracuse that is going through foreclosure. After the foreclosure sale, there is a surplus of $15,000 remaining after paying off the mortgage and all costs. Under New York law, who is entitled to receive this surplus?
Correct Answer
B) The surplus is distributed to the original borrower/property owner
Under New York law, any surplus remaining after a foreclosure sale (after paying the mortgage debt, costs, and other liens) belongs to the original borrower/property owner. The borrower maintains the right to claim these surplus funds even after losing the property through foreclosure.
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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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