Question

Under which loan transaction would the lender have the best opportunity to secure a deficiency judgment in the event of a default and foreclosure

Answer 1

In a default and foreclosure scenario, the lender has the best opportunity to secure a deficiency judgment under a recourse loan transaction.

Step-by-step explanation:

In the event of a default and foreclosure, the lender would have the best opportunity to secure a deficiency judgment under a recourse loan transaction. In a recourse loan, the lender can pursue the borrower for the difference between the amount owed on the loan and the foreclosure sale price. This provides the lender with an additional means to recover the outstanding debt.