A Dry Mortgage, also known as a Nonrecourse Mortgage, is a type of financing where the borrower is not personally liable beyond the collateral securing the loan. In these agreements, the lender can seize the property used as collateral to satisfy the loan, but cannot pursue the borrower for any remaining balance if the collateral does not cover the full liability.
Joint and several liability is an obligation that allows a creditor to demand full repayment from any or all of those who have borrowed. Each borrower is liable for the entire debt, not just a prorated share.
A nonassumption clause, also known as a due-on-sale clause, is a clause in a mortgage contract that prevents the transfer of the mortgage terms to another borrower in the event of a sale. This clause is used to protect lenders from the potential risks of new borrowers who might be less creditworthy than the original borrower.
