Which of the following describes a lien theory state?

A lien theory state is characterized by the borrower retaining title to the property while the lender holds a lien against it. This means that while the borrower has full ownership rights and responsibilities associated with the property, such as paying property taxes and maintaining the home, the lender maintains a legal claim over the property as security for the loan. If the borrower defaults on the mortgage, the lender can initiate foreclosure proceedings to recover the owed amount. In this arrangement, the lien does not transfer ownership to the lender but rather gives them the right to take action against the property under certain circumstances.

This distinction is important in understanding how ownership and rights operate in various states, particularly when comparing lien theory with title theory, where the lender may hold the title until the mortgage is paid off.