Real Estate Mortgagor and Mortgagee - Examining Position and Rights

The mortgagor is the person borrowing the loan andwriting, may demand payment either immediately or
the mortgagee is the person lending the loan toat the end of the three months and if it is drafted in
purchase for example Jamaica beach real estate andthe latter form, the mortgagee need not wait for a
property.further three months before selling, but can exercise
Position and Rights of the Mortgagorhis power after the lapse of three months from the
1. The Equity of Redemptionservice of notice. If there is more than one
A mortgagor is the owner of the equity ofmortgagee, the notice should also be served upon
redemption. The right of redemption is said to bethe other mortgagees.
inviolable in that the mortgage cannot include in the(b) Some interest is in arrears for two months or
mortgage deed anything which takes awaymore; or
completely the mortgagor's right to redeem, or which(c) There has been a breach of some covenant in
postpones it indefinitely.the mortgage deed other than the covenant to
2. Rights of a Mortgagor who remains in possessionrepay the principal and interest. For example, if the
In the eyes of equity, the mortgagor remains themortgagor has broken a covenant to keep premises
true owner of the property and as long as hein repair, the mortgagee can exercise his powers of
remains in possession, he is entitled to appropriatesale immediately, despite the fact that no interest is
the rents and profits to his own use without anyin arrear and that he has not demanded repayment
liability to account from them, even though he mayof the loan.
be in default in the payment of the interest to theA mortgagee may sell the mortgaged property at
mortgagee. The mortgagor has the right to grantany time after the power of sale has arisen, even
valid leases. If the lease is unauthorized, it will not bindbefore it is exercisable, but the mortgagor will have a
the mortgagee.right of action in damages against the mortgagee.
Effects of Death of a MortgagorWhen exercising his power of sale, the mortgagee
On the death of a mortgagor, the equity goesneed only act reasonably in the matter. He is not
through his personal representatives to the personsbound to sell only for the best price, so long as he
entitled intestacy if he dies without leaving a Will andsells in good faith. Once he has sold, he becomes a
to his devisee if he leaves a Will.trustee of the proceeds of sale and after paying off
If the personal representatives are required to pay,the outstanding debts due to himself he must hand
they can recoup themselves from the mortgagedthe balance over to the next mortgagee, if there is
property or if that is insufficient, from the otherone, or to the mortgagor. If the person exercising
assets of the deceased. The mortgagee's remediesthe power of sale is not the first mortgagee, then
are not affected by the death of a mortgagor.the purchaser takes the fee simple subject to prior
Position and rights of the mortgageemortgages and he will himself be deprived of the fee
The mortgagee's rights and remedies are given tosimple if such a first mortgagee exercises his powers
him for one purpose only - to secure his principal andof sale or foreclosure.
interest.The mortgagee can sell when he likes even though
(1) Power of Salethe market is likely to improve if he holds his hand
The power of sale arises as soon as any installmentand the result of an immediate sale is a profit for the
is due and unpaid. It nevertheless does not becomemortgagor the purchase price is going to only be able
exercisable until either:to clear the outstanding principal mortgage and
(a) Notice has been served on the mortgagor askingpossibly none of the interest accrued. These are
for repayment and the money has not been repaidimportant when you expect to be purchasing some
within three months. The notice which must be inof the cheapest land to buy by the beach in Jamaica.