Which term refers to the right of a borrower in default to reclaim their property before foreclosure?

The term that refers to the right of a borrower in default to reclaim their property before foreclosure is "Equitable Redemption." This right allows borrowers to pay off their overdue payments and reclaim their property, thereby preventing the foreclosure process from proceeding. The principle behind equitable redemption is rooted in fairness, allowing borrowers a chance to rectify their default situation before losing their home or property.

This concept is significant in real estate and mortgage transactions, as it recognizes the importance of giving borrowers the opportunity to resolve their financial issues and retain ownership of their property. Banks and financial institutions typically allow this process to foster a sense of responsibility and offer a pathway for borrowers to regain control of their financial situation.

The other terms do not convey the same meaning. For example, equitable title relates to a person's right to obtain full ownership of property, while equity generally refers to the value of an owner's interest in property after deducting any liabilities. Encroachment, on the other hand, refers to the intrusion of a structure or improvement of one property onto another property, which is unrelated to the rights of borrowers in default.