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Real estate glossaryGeorgia-specific rule

Power of sale

A power-of-sale clause authorizes the secured creditor to sell the collateral after default through the contractually authorized nonjudicial foreclosure process, provided Georgia's notice, advertisement, time, place, and sale requirements are met.

Exam area: Finance and Closing

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What does “power of sale” mean in real estate?

A power-of-sale clause authorizes the secured creditor to sell the collateral after default through the contractually authorized nonjudicial foreclosure process, provided Georgia's notice, advertisement, time, place, and sale requirements are met.

How is “power of sale” different from the closest wrong answer?

Power of sale is the authority in the security instrument. Foreclosure is the enforcement process, and judicial foreclosure proceeds through a court judgment.

What is the Georgia-specific rule?

Georgia security deeds commonly contain power-of-sale language. Statutory notice and sale safeguards still apply, so the lender cannot simply take or privately sell the property at will.

Worked exam example

Scenario

After uncured default, a creditor follows Georgia's required notice and public-sale procedure under the deed's power-of-sale provision.

What is the most common exam trap?

Trap correction

Nonjudicial does not mean unregulated or immediate. The absence of a foreclosure lawsuit does not remove statutory steps.

Original exam check

Apply the definition

A Georgia borrower defaults on a loan secured by a security deed that contains a power-of-sale clause. Which statement about the lender's remedy is accurate?

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Related terms to learn next

Security deed

A security deed, also called a deed to secure debt, is Georgia's customary instrument for securing a real estate loan.

Title theory

Title theory describes a financing system in which the security instrument places legal title with the lender until the secured debt is satisfied, while the borrower keeps equitable ownership and possession.

Acceleration clause

An acceleration clause permits the lender, after a defined default and required process, to declare the entire unpaid loan balance immediately due rather than collect only the missed installment.

Satisfaction or cancellation of security deed

Satisfaction or cancellation of a Georgia security deed is the formal record that the secured debt has been paid and the security deed has been canceled, which operates to reconvey title as provided by Georgia law.

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Continue with Finance and Closing complete lesson. It places this term inside the full rule, worked examples, exam traps, and mixed practice required for mastery.
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