Fact Pattern 29-2
Robin's home is in a state that has a $30,000 homestead exemption. Robin defaults on a $60,000 debt that she owes to Suburban Mortgage Company. Robin's home is sold at auction for $80,000.
-Refer to Fact Pattern 29-2. Suburban Mortgage may recover
A) $0.
B) $30,000.
C) $50,000.
D) $60,000.

Question

Fact Pattern 29-2
Robin's home is in a state that has a $30,000 homestead exemption. Robin defaults on a $60,000 debt that she owes to Suburban Mortgage Company. Robin's home is sold at auction for $80,000.
-Refer to Fact Pattern 29-2. Suburban Mortgage may recover​
A) $0.​
B) ​$30,000.
C) ​$50,000.
D) ​$60,000.

Quizplus · Accepted Answer

Suburban Mortgage may recover the amount of the debt owed, which is $60,000, and may also recover the excess proceeds from the auction sale, which is $20,000 ($80,000 sale price minus $60,000 debt). However, the homestead exemption of $30,000 must be deducted from the excess proceeds. Therefore, Suburban Mortgage may recover a total of $50,000 ($60,000 debt plus $20,000 excess proceeds minus $30,000 homestead exemption).

Fact Pattern 29-2 Robin's Home Is in a State That Has a $30,000