Mortgages

Who or what is the mortgagor?

• The bank or the building society who lends the money secured on the property.

• The owner of the property, who grants the bank or building society a mortgage over his or her home.

• The loan agreement secured on the property.

• A person who arranges mortgages for people who want them.

The mortgagor can redeem the mortgage only at the legal date of redemption.

• True

• False

Which of the following statements is correct?

• A legal mortgage in registered land can be created by demise: by granting a lease to the mortgagee.

• A legal mortgage in registered land can be created by transferring the freehold of the land to the mortgagee.

• A legal mortgage in registered land can now only be created by means of a legal charge over the land.

• A legal mortgage over registered land can no longer be created.

The term "clogs and fetters" refers to one or some of the following statements. Please select all that apply.

• Any term of the mortgage which attempts to restrict the mortgagor's right to redeem the mortgage.

• Any term of the mortgage.

• Any term of the mortgage which allows the mortgagee to obtain an unfair collateral advantage from the mortgagor.

• The signatures of the parties to the mortgage and of their witnesses.

The mortgagee can choose all or any of the five potential remedies that it has in the court if the mortgagor defaults on his or her payments in order to recover its money.

• True

• False

The right of the mortgagee to enter into possession of the property arises when:

• The mortgage agreement comes into existence.

• The mortgagor defaults on a mortgage instalment.

• The mortgagor breaches a material term of the mortgage agreement.

• The mortgagor redeems the mortgage.

The AJA 1970 s.36 provides valuable protection for the mortgagor, if he can prove to the court that he can pay back any sums due under the mortgage in a reasonable time. In deciding what constitutes a "reasonable time", the court takes as its starting

point a period of:

• 6 months

• 2 years

• 10 years

• The remaining term of the mortgage

The power of sale is exercisable as soon as the legal date of redemption is passed.

• True

• False

Which of the following statements is correct?

When the mortgagee decides to sell a mortgaged property to recover its money, it must:

• Sell the property as quickly as it can - whatever the price offered by potential purchasers.

• Ensure that all information relevant to true the market value of the property is made known to potential purchasers.

• Sell the property to the first person who offers to buy it.

• Not sell the property until market conditions are favourable.

A bank can avoid the risk of a court setting aside a mortgage for a husband exerting undue influence to obtain the wife's consent to the mortgage if it:

• Simply writes to the wife, suggesting that she obtains independent legal advice.

• Obtains confirmation from a solicitor nominated by the wife that the wife has had a one-to one-meeting with the solicitor in which the solicitor explains the implications of the document that she will be signing.

• Insists that the wife comes into the bank for a meeting with the bank manager.

• Invites the husband and wife to come in to the bank together to discuss the implications of the wife signing the mortgage agreement.