In a Deed of Trust Transaction, When a Trustee Sells

question 46

Multiple Choice

In a deed of trust transaction, when a trustee sells the property and the proceeds generate a deficiency, the _____.

• A) borrower is relieved of all obligations to the lender
• B) lender may sue the borrower on the debt and recover a judgment
• C) lender may sue the trustee
• D) trustee may sue the borrower

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Definitions:

Payment Of Principal

The act of paying back the original amount borrowed in a loan, separate from interest payments.

Lower In Priority

A status indicating lesser importance or urgency in comparison to other items or tasks.

Convertible Bond

A bond that can be converted into a specified number of shares of stock at the owner’s discretion.

Conversion Price

The predetermined price at which convertible securities can be converted into common stock.