Equity of Redemption
The borrower's right to stop a foreclosure by paying the full amount owed before the foreclosure sale takes place.
Quick flashcard
What does Equity of Redemption mean on the Texas real estate exam?
Answer: The borrower's right to stop a foreclosure by paying the full amount owed before the foreclosure sale takes place.
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Equity of Redemption definition
The equitable right of redemption is the borrower's right to reclaim the property by paying the entire debt, plus costs, before the foreclosure sale occurs. In Texas, the borrower can cure the default or pay off the loan up until the trustee's sale, but once the non-judicial sale is held, that right ends.
Texas does not provide a statutory right to redeem an ordinary home loan after a deed-of-trust foreclosure sale. A limited statutory right of redemption does exist after a tax sale and for certain property-owners-association foreclosures.
Source basis
Definition checked against the official sources below on .
On the exam
Exam trap
Tested in
Financing & Settlement (7 of 80 National)
From definition to recall
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Try 5 free questionsThis definition is Texas real estate exam-prep education, not legal, tax, or professional advice. Verify current rules against the official source before relying on them for a real transaction. Back to the full glossary.