A homeowner in Portland, Oregon defaults on a trust deed loan with an outstanding principal balance of $320,000. The lender initiates a non-judicial (trustee's sale) foreclosure. Under Oregon's Trust Deed Act (ORS Chapter 86), the borrower has the statutory right to reinstate the loan by paying all past-due amounts, fees, and costs. The borrower's monthly payment is $2,000, and they have missed 4 consecutive payments. The lender's attorney fees and foreclosure costs total $4,800. What is the minimum total amount the borrower must pay to reinstate the loan and stop the trustee's sale?
Correct Answer
A) $12,800
Under Oregon's Trust Deed Act (ORS Chapter 86), reinstatement requires the borrower to cure the default by paying all past-due payments plus allowable fees and costs — NOT the full loan balance. The calculation is: 4 missed payments × $2,000 = $8,000 in arrears, plus $4,800 in lender attorney fees and foreclosure costs, for a total reinstatement amount of $12,800. Oregon law grants the right to reinstate up to five days before the scheduled trustee's sale date. Reinstatement restores the loan to its original terms without requiring full payoff.
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