Intermediate theory is a sort of hybrid approach that features elements of both title theory and lien theory. Intermediate theory allows the borrower to retain the title but gives the lender the right to take the title if the borrower defaults on their loan payments.
If you live in an intermediate theory state, you hold the title of your home (like in a lien theory state). But if you default on your payments, your lender can take back ownership of the title (like in a title theory state).