A Texas borrower defaults on a deed of trust loan. The lender decides to foreclose. Under Texas Property Code §51.002, what type of foreclosure is typically used for deed of trust loans in Texas?
Correct Answer
D) Non-judicial foreclosure, using the trustee's power of sale without court involvement
Texas is a non-judicial foreclosure state for deed of trust loans. Under Texas Property Code §51.002, the trustee can exercise the power of sale contained in the deed of trust to foreclose without court involvement, making the process faster and less expensive than judicial foreclosure.
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The debt-to-income ratio (DTI) compares a borrower's monthly debt obligations to their gross monthly income. It is used by lenders to determine how much mortgage a borrower can afford.
In the context of foreclosure, a deed transfers ownership of the foreclosed property to the new owner, typically the buyer at a foreclosure sale.
Discount points are upfront fees paid to a lender at closing to reduce (buy down) the interest rate on a mortgage loan. One point equals 1% of the loan amount and typically reduces the rate by approximately 0.25%.
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