Mark for follow up Question 10 of 75. Generally, a non-recourse borrower will realize gain on the foreclosure or repossession of secured property when the is greater than the borrower's tax basis in the property. Balance of principal outstanding. Repossession costs. Fair market value (FMV). Original purchase price. Mark for follow up Question 11 of 75. When a debt is nonrecourse, this means the Lender may not foreclose or repossess the property that secures the debt. Lender has no right to seek payment from the borrower for any debt in excess of collateral. O Borrower may recognize ordinary income from the cancellation of debt. Borrower will not recognize gain or loss on the disposition of the property. Mark for follow up