Under an installment contract, if the buyer defaults, what is true?

• A. The Seller May Not Have to Foreclose
• B. The Buyer Loses All Payments
• C. The Contract Dissolves
• D. The Seller Must Foreclose

Answer: (A)

In an installment contract, the seller keeps legal title until the buyer pays in full, so the remedy for default is not foreclosure. Because no mortgage or deed of trust is involved, the seller can pursue contractual remedies such as cancelling or forfeiting the contract and retaking the property, or suing for breach and damages. Foreclosure is a remedy tied to mortgage security interests, not to an installment sale, so the seller isn’t required to foreclose.

That’s why the statement is true: the seller may not have to foreclose. The other choices imply automatic outcomes (losing all payments, automatic dissolution of the contract, or a mandatory foreclosure) that don’t align with how installment contracts operate, where forfeiture or breach remedies can apply without foreclosure.