Question

In: Accounting

2. How might a notice of default and foreclosure actually benefit a debtor who is behind...

2. How might a notice of default and foreclosure actually benefit a debtor who is behind on payments?

3. Should the federal government regulate the advertising of real property and mortgages on the Internet to protect consumers from potential fraud? Why or why not? If so, what kind of regulations would be appropriate, and how might they be enforced?

Solutions

Expert Solution

  1. Notice of default and foreclosure is the step when creditor puts a notice outside the house / or sends notice to the borrower to repay the amount an if the amount is not paid within the specified period, that property will be seized by the lender. There will be no right of the borrower on that property and lender can use that property to pay off the debt.

In this case when such notice is issued, borrower/debtor benefits by preventing damage to his / her credit ratings. The lender will claim only that property and there is no effect in credit ratings of the debtor. Other debtors are also benefitted as creditors will lend more as the number of default payments gets reduced and loan/ credit is available to debtors at cheaper rates.

  1. Yes, the federal government should regulate advertising of real property and mortgages as there is a large number of misleading advertisements on the internet . There is a big possibility that buyers and sellers are deceived by false and misleading advertisements. The consequences of this may be severe. By the intervention of the government in this area will regulate the real estate and advertisements at the federal level. There are already many federal regulations applicable, there s a need to regulate these rules more appropriately and all the transactions within the state must be closely checked.

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