Exam 26: Credit, mortgages, and Debtors Rights

Roundwell Motors purchases a manufacturing plant for $15 million,pays $5 million in cash as down payment,and borrows the remaining $10 million from Home Providence Bank.To secure the loan,Roundwell gives the plant as collateral to Home Providence Bank.What kind of collateral arrangement is in place between Roundwell Motors and Home Providence Bank?

Ethan purchases a house for $250,000.He borrows $200,000 from StarCross Bank and gives the bank a mortgage on the house for this amount.StarCross Bank fails to record the mortgage.Ethan then applies to borrow $200,000 from Pentalon Bank.Pentalon Bank reviews the real estate recordings and finds no mortgage recorded against the property,so it lends Ethan $200,000.Pentalon Bank records its mortgage.Later,Ethan defaults on both loans.In this case,which of the following would be true in case of the possible foreclosure on the collateral?

A recording statute gives potential purchasers of real property the ability to determine whether there are existing liens on a property.

Which of the following is true of a guarantor in a guaranty arrangement?

A surety is primarily liable for paying the principal debtor's debt when it is due in a surety arrangement.

Briefly explain the key features of the Consumer Financial Protection Act of 2010.

A writ of ________ is a postjudgment court order that permits the seizure of a debtor's property that is in the debtor's possession.

How does the Mortgage Reform and Anti-Predatory Lending Act of 2010 help regulate mortgage transactions?

What is an antideficiency statute?

The ________ Act of 2010 is a federal statute that requires increased disclosure of credit information and terms to consumers and regulates consumer credit providers and others.