Chapter 15 Introduction to Mortgage
Law
is not - ANS-Legally, a mortgage (is/is not ) a loan
security - ANS-The mortgage grants an estate in land to the lender as _____ for a loan made by
a lender (the mortgagee) to the borrower (the mortgagor).
debt - ANS-Although almost all mortgage agreements contain a promise to repay a ______, a
mortgage is not a ______
Lender - ANS--is called a morgagee
-provides loan to borrower
-receives mortgage as security for the loan
Borrower - ANS--called a mortgagor
-obtains loan from lender
-grants mortgage as security for loan
prevented - ANS-There is one principle which is fundamental to mortgage law: a borrower
cannot be ________ by the terms of the mortgage from eventually redeeming his or her
property free from the conditions contained in the mortgage.
clog - ANS-A term which merely prohibits or restricts prepayment of the mortgage prior to the
maturity date or prevents the assumption of the mortgage (for example by a buyer of the
mortgaged property) does not constitute a _____on the equity of redemption and can be
enforced.
acceleration - ANS-An __________ clause allows the lender,upon the borrower's default, to
demand payment in full of the outstanding balance on the mortgage even if the mortgage has
not yet matured. It operates at the option of the lender so that the borrower cannot compel the
lender to act under it simply by failing to make payments or defaulting in some other way.
mortgagee - ANS-In any event, the ______ shall not be liable for any failure to insure the
buildings, the non-payment of premiums on any policy, or any loss arising out of any defect in
any policy or failure of insurer to indemnify for any loss.
priority of further advances - ANS-If a lender receives notice that a judgement or new mortgage
is being registered, the lender will want to ensure that no further funds are advanced on the line
of credit to avoid losing ? to the judgement holder or new mortgagee.
, gaurantor - ANS-One who becomes contingently or secondarily liable for another's debt or
performance
covenantor - ANS-A _____ is a primary debtor and is responsible for the loan as though they
themselves were the borrower.
Furthermore, the lender may collect from the ? before the lender exhausts all available
remedies against the borrower.
covenantor than a gaurantor - ANS-It is easier to enforce loans against ?
Vendor Take-Back Mortgage - ANS-A mortgage taken back by the vendor from the purchaser to
facilitate a sale, whereby the vendor becomes the mortgagee and the purchaser becomes the
mortgagor
80, 95 - ANS-Conventional mortgages, which are limited by statute to __% of the property value
( or a maximum of __% if the mortgage is insured), there is no such restriction with private
vendor financing.
Reverse annuity mortgage - ANS-An innovative loan arrangement in which the lender makes
periodic payments to the borrower during the loan term. At the end of the term, the borrower will
have to repay the balance owing by refinancing or selling the property
Bridge financing - ANS-is a type of interim financing whereby a borrower will receive a loan and
grant a mortgage to a lender for a short period of time while long-term financing is being
pursued.
federal - ANS-The ______ Interest Act imposes no limit on the rate of interest that can be
charged in a mortgage transaction.
provinvial - ANS-A rate of interest can be attacked under ______ legislation if it is oppressive or
unconscionable, or under the federal criminal code if it constitutes a criminal rate of interest.
Blended - ANS-_____ payments are those payments which do not separate the interest portion
from the principal portion
6 - ANS-Section ? requires that the mortgage document contain a statement of the interest rate
calculated either "yearly or half-yearly not in advance.
7 - ANS-Section ? provides that where the rate in the required statement is lower than the rate
in the repayment clause, only the lower rate can be collected
yearly - ANS-Note that if a mortgage merely requires interest at a set rate per annum, it will be
assumed that it is to be calculated _______, not in advance.
Law
is not - ANS-Legally, a mortgage (is/is not ) a loan
security - ANS-The mortgage grants an estate in land to the lender as _____ for a loan made by
a lender (the mortgagee) to the borrower (the mortgagor).
debt - ANS-Although almost all mortgage agreements contain a promise to repay a ______, a
mortgage is not a ______
Lender - ANS--is called a morgagee
-provides loan to borrower
-receives mortgage as security for the loan
Borrower - ANS--called a mortgagor
-obtains loan from lender
-grants mortgage as security for loan
prevented - ANS-There is one principle which is fundamental to mortgage law: a borrower
cannot be ________ by the terms of the mortgage from eventually redeeming his or her
property free from the conditions contained in the mortgage.
clog - ANS-A term which merely prohibits or restricts prepayment of the mortgage prior to the
maturity date or prevents the assumption of the mortgage (for example by a buyer of the
mortgaged property) does not constitute a _____on the equity of redemption and can be
enforced.
acceleration - ANS-An __________ clause allows the lender,upon the borrower's default, to
demand payment in full of the outstanding balance on the mortgage even if the mortgage has
not yet matured. It operates at the option of the lender so that the borrower cannot compel the
lender to act under it simply by failing to make payments or defaulting in some other way.
mortgagee - ANS-In any event, the ______ shall not be liable for any failure to insure the
buildings, the non-payment of premiums on any policy, or any loss arising out of any defect in
any policy or failure of insurer to indemnify for any loss.
priority of further advances - ANS-If a lender receives notice that a judgement or new mortgage
is being registered, the lender will want to ensure that no further funds are advanced on the line
of credit to avoid losing ? to the judgement holder or new mortgagee.
, gaurantor - ANS-One who becomes contingently or secondarily liable for another's debt or
performance
covenantor - ANS-A _____ is a primary debtor and is responsible for the loan as though they
themselves were the borrower.
Furthermore, the lender may collect from the ? before the lender exhausts all available
remedies against the borrower.
covenantor than a gaurantor - ANS-It is easier to enforce loans against ?
Vendor Take-Back Mortgage - ANS-A mortgage taken back by the vendor from the purchaser to
facilitate a sale, whereby the vendor becomes the mortgagee and the purchaser becomes the
mortgagor
80, 95 - ANS-Conventional mortgages, which are limited by statute to __% of the property value
( or a maximum of __% if the mortgage is insured), there is no such restriction with private
vendor financing.
Reverse annuity mortgage - ANS-An innovative loan arrangement in which the lender makes
periodic payments to the borrower during the loan term. At the end of the term, the borrower will
have to repay the balance owing by refinancing or selling the property
Bridge financing - ANS-is a type of interim financing whereby a borrower will receive a loan and
grant a mortgage to a lender for a short period of time while long-term financing is being
pursued.
federal - ANS-The ______ Interest Act imposes no limit on the rate of interest that can be
charged in a mortgage transaction.
provinvial - ANS-A rate of interest can be attacked under ______ legislation if it is oppressive or
unconscionable, or under the federal criminal code if it constitutes a criminal rate of interest.
Blended - ANS-_____ payments are those payments which do not separate the interest portion
from the principal portion
6 - ANS-Section ? requires that the mortgage document contain a statement of the interest rate
calculated either "yearly or half-yearly not in advance.
7 - ANS-Section ? provides that where the rate in the required statement is lower than the rate
in the repayment clause, only the lower rate can be collected
yearly - ANS-Note that if a mortgage merely requires interest at a set rate per annum, it will be
assumed that it is to be calculated _______, not in advance.
