Exam 28: Introduction to Credit and Secured Transactions

What does the term "judgment-proof" imply about a debtor?

Jerry wants to purchase a flat. So he borrows $50,000 from XYZ bank. He signs a note for $50,000 and gives the bank a $50,000 mortgage on the flat as security for his repayment of loan. Within a year and a half, Jerry repays the entire loan. After the repayment of the loan, which of the following right does Jerry have against XYZ bank?

A difference between a surety and a guarantor is that the guarantors:

Generally, the procedure for declaring a forfeiture and recovering property sold on a land contract is simpler and less time-consuming than foreclosure of a mortgage.

Explain the difference between an accommodation surety and a compensated surety.

Under which of the following systems of foreclosure does the creditor have no right to recover any deficiency between the value of the property and the amount of the debt?

What is an equity of redemption?

A party who borrows money to buy a home and signs an agreement giving the bank the right to repossess the home in case of default is called a:

Article 9 of Uniform Commercial Code deals with provisions regarding security interests involved in a personal property.

Jones hired Smith, a general contractor, to build a garage as an addition to Jones' home. Smith hired Adam to do the roofing work on this garage. All the work was done satisfactorily, and at the completion of the work, Jones paid Smith the agreed price. However, Smith never paid Adam for his work. Three weeks after Adam finished his work, he filed a mechanics' lien against the property and demanded that Jones pays him for his work. Which of the following is most correct?

A "_____" is a security interest in real property or a deed to real property that is given by the owner as security for a debt owed to the creditor.

Robert cosigns a note for his friend Amelia, which she has given to Credit Union to secure a loan. Suppose the note was originally for $5,000 and payable in 12 months with interest at 10 percent a year. Credit Union and Amelia later agree that Kato will have 24 months to repay the note but that the interest will be 13 percent per year. Robert is not aware of this change of terms. In the event of Amelia defaulting on the loan, will Robert have to repay the debt?

A clause in a mortgage specifies that "if the mortgaged property is sold, then the remaining balance becomes immediately due and payable". This clause is called:

A distinction between a surety and a co-surety is that only a co-surety is entitled to the right of:

Give two reasons why the surety-guarantor distinction is important.

Which of the following statements is true regarding a guarantor?

Which of the following is an essential element of a lien?

A(n) _____ is secondarily liable for the debt of the principal debtor.

Payne borrowed $500 from Long Bank. At the time the loan was made to Payne, Gem orally agreed with Long that Gem would repay the loan if Payne failed to do so. Gem received no personal benefit as a result of the loan to Payne. Which of the following is most likely to be true, under the circumstances?

A submaterialman is not entitled to a lien, unless specifically stated by the Statute of the State which is applicable to him.