Mortgage Law - Pty Ltd Report

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Added on 2020-02-24

Mortgage Law - Pty Ltd Report

Added on 2020-02-24

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ConveyerPart one Home is usually considered to be the largest asset of an individual thus sold as a mortgage. Themortgagee according to laws, is entitled to certain powers and obligations. It is advisable tounderstand these capabilities before buying any house on mortgage. In this situation, Pty Ltd hasseveral legal duties and powers. Foremost, Pty Ltd has a constitutional right to sue Mr. Henryfor default in payment. Mr. Henry must have agreed on monthly payment according to the‘personal covenant' document that guides entry into this kind of agreement. Pty Ltd can take thesecurity of the Torrens Title property by either taking back the building or directly selling thehouse. However, according to the laws, he can decide to settle this case with Henry in a court oflaw1. It is also possible that Pty Ltd can decide to sub-mortgage the building. In this case, Henry willbe allowed only a section of the property while another person or people will have to be incharge of a different section. This is most appropriate in the situation where Pty Ltd feels thatHenry defaults in payment maybe because he cannot afford to pay the monthly bill that isrequired. It is however advised that this kind of an agreement be settled in a court of law or aftermutual consensus. It is a fact that Henry may not be comfortable with this new arrangement butPty Ltd has all the rights to force this or to leave it for another option2.1Welling, Henry. "Construction of Inconsistent Provisions in a Bond and Mortgage."St. John's LawReview5, no. 2 (2014): 12.2 Brotman, Helen L. "Insurance--Effect of Mistatement of Ownership on Rights of Mortgagee underStandard Mortgagee Clause."St. John's Law Review6, no. 1 (2014): 16.

However, before making any of above decisions, Henry must be served with a notice asdescribed in the Property Law Act. This is according to the legal requirements. It is not to justdecide to do something as mortgagee with informing Henry promptly. Usually, thiscommunication is done a month before the real day. For example, if Pty Ltd wanted to sell theproperty to another person they would have to give Henry at least a one-month vacation notice.Before the vacation notice, however, he must be issued with cautionary notice3. This noticewarns him of the possible implications of failing to pay the mortgages as agreed at the point ofentering into this agreement. During this period Henry can settle the outstanding balance. He canas well appeal against this decision a move that must be taken in a court of law. Change of theinterest rates is only done when it is oppressive. However, there must be other evidence ofexploitation such as unequal bargaining for the court to agree to lower the interest rates charged.In fact, Henry can use this loophole to ensure that he pays less to Pty Ltd to be able to keep upwith the monthly payments. Henry must pay the mortgages even after defaulting. If he keeps upwith payment, there will not be a need for Pty Ltd to withdraw the agreement and enter into anew agreement with another person4. After issuing the notice, Pty Ltd would be free to mortgage the property to anyone they wish.This would be a new agreement that would have different terms and conditions. The terms of thisnew agreement must be agreed upon by all the parties involved. The greatest issue of concern, inthis case, would be interest rate which can change depending on the decision of Pty Ltd. It ispossible for Pty Ltd t to sell to Sly provided that Sly acts on his own and not on behalf of thecompany. This a special provision that Pty Ltd can undertake. All that matters is that Sly agrees3 Tabb, Charles J. "The Bankruptcy Clause, the Fifth Amendment, and the Limited Rights of SecuredCreditors in Bankruptcy."U. Ill. L. Rev.(2015): 765.4 Dixon, Bill. "Mortgagee's failure to take reasonable care to sell at market value."The QueenslandLawyer34, no. 4 (2014): 151-153.

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