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The Legal Title of a property remains in the borrower’s

name.

That is the Mortgagor is entitled to retain

legal Title Mortgagor,

throughout. The owner of the land

not

the

Mortgagee.

The

Mortgagee

his full is the merely

takes a security interest by way of the land. The Mortgagee is entitled capital together with the appropriate

Charge or Lease over only to the return of his interest thereon.

Equity of Redemption

Equity of redemption means paying back the loan. Once the loan is repaid the Mortgagee is under the obligation to reconvey that Legal Estate back to the Mortgagor.

For example, if the property has a Market Value of $100,000, and the mortgage debt stands at $60,000, then, the value of the Mortgagor’s Equity of Redemption is $40,000. The value of this equity will tend to increase due to the increase in land values as well as by reason of the gradual discharge of the mortgage debt.

How is a Mortgage Discharge?

The mortgage will be discharged when the Mortgagor repays the loan. The Mortgagee may sell the property or foreclose, but this exercise, wilI be pursued only if the Mortgagor defaults. The operation of the limitation statute can also discharge the mortgage.

45

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