Under lien theory, what is presumed about a lender's mortgage?

Under lien theory, it is fundamentally understood that a lender's mortgage secures a loan with a lien against the property. This legal concept establishes that when a borrower takes out a mortgage, the lender does not gain ownership of the property but instead holds a security interest in it. This means that while the borrower retains ownership and has the right to occupy and use the property, the lender has a claim against it that can be enforced in the event of default.

In lien theory states, the borrower retains title to the property; the lender's mortgage serves as a lien, which is a legal right or interest that a lender has in the borrower's property, granted until the debt obligation is satisfied. Thus, if the borrower fails to meet their repayment obligations, the lender has the right to initiate foreclosure proceedings to recover the outstanding loan amount by selling the property.

The other options suggest scenarios that do not align with the principles of lien theory. For instance, the idea that a lender grants "ownership" of the property or is allowed to occupy it contradicts the fundamental nature of mortgage lending under lien theory, where the borrower maintains ownership and control of the property unless there is a default. Similarly, the notion of preventing the borrower from selling the property or allowing occupancy