A borrower has defaulted on their mortgage payments, triggering the pre-foreclosure process. During this time, the borrower remains in possession of the property. What action is the borrower legally permitted to take?
Sell the property to someone else without notifying the lender about the transaction.
Discontinue any maintenance or repairs on the property.
Vacate the property as the lender now has full control.
Keep possession of the property and take reasonable steps to preserve its condition.
The correct answer highlights the borrower's legal right to retain possession of the property and the obligation to ensure its upkeep during the pre-foreclosure period. As long as foreclosure has not been finalized, the borrower retains both legal and equitable ownership rights and must preserve the property's value. The incorrect answers introduce misunderstandings, such as the ability to transfer title without lender authorization or neglecting the property's condition, which would harm the lender's collateral interest.
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What does pre-foreclosure mean?
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What are the borrower's rights during pre-foreclosure?
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What steps should a borrower take to preserve their property during pre-foreclosure?