Exam 29: Creditors Rights and Remedies

Any loan for which repayment is ensured by collateral pledged by the borrower is a secured transaction .

Because a mortgage involves the transfer of real property, to comply with the Statute of Frauds, it must be

United Contractors Inc. holds a lien on Vista Estate's real property. This property can be sold to satisfy the debt if, before the sale, notice is given to

Most creditors require a borrower to purchase mortgage insurance if the borrower makes a down payment of at least 20 percent of the purchase price.

Rashi is a student at State University. To pay tuition, Rashi asks Tempo Loans Inc. for a short-term loan. The lender agrees to make a loan if Rashi will have someone who is financially responsible guarantee the loan payments. Upton, a well-known businessperson and a friend of Rashi's family, calls Tempo and agrees to pay the loan if Rashi cannot. Because of Upton's reputation, the loan is made. Rashi is making the payments, but because of illness he is unable to work for one month. He asks Tempo to extend the loan for three months. The lender agrees, raising the interest rate for the extended period. Upton is not notified of the extension (and thus does not consent to it). One month later, Rashi drops out of school. All attempts to collect the remainder of the loan from Rashi fail. Can Tempo assert a claim against Upton on the debt?

Auto Sales & Finance wants to get paid for its goods and services, so it will not sell goods or lend funds unless payment is guaranteed. To obtain those goods or services, a customer or borrower might pledge

Bankruptcy statutes were not designed specifically to assist debtors in need of help.

Mortgage insurance compensates a debtor for losses due to a default on a mortgage loan.

To initiate a foreclosure, a lender must pay the full amount of the debt, plus any costs that have accrued.

Because a mortgage involves a transfer of real property, it need not be in writing.

The loans made by companies that provide credit cards are not backed by collateral.

Every state allows a defaulting borrower to redeem the property before the foreclosure sale.