Mortgage Law and Practice Flashcards
6 cards from real CEMAP practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 Mortgage Law and Practice flashcards as text
What is the legal difference between a mortgage and a charge in English property law?
Answer: A mortgage transfers ownership while a charge creates a security interest without transfer
Historically, a mortgage transferred legal title to the lender, while a charge creates a security interest without any transfer of ownership.
Under the Consumer Credit Act 1974, what rights does a borrower have regarding early repayment of a regulated mortgage?
Answer: The right to make early repayment at any time, with the lender limited in the charges they can apply
Under the Consumer Credit Act 1974 (for regulated agreements), borrowers have the right to make early repayment and lenders are restricted in the charges they can impose.
What is the significance of the Land Registration Act 2002 for mortgage lenders?
Answer: It established that legal charges over registered land must be registered at the Land Registry to take effect
The Land Registration Act 2002 requires charges over registered land to be registered at the Land Registry — an unregistered charge will not take effect as a legal charge.
What duty does the mortgagee (lender) owe when exercising their power of sale?
Answer: A duty to obtain the best price reasonably obtainable at the time of sale
The lender must take reasonable care to obtain the best price reasonably obtainable, as established in case law and statute.
What is an equity of redemption in mortgage law?
Answer: The borrower's right to redeem (pay off) the mortgage and recover full ownership free from the charge
The equity of redemption is the borrower's fundamental right in equity to repay the mortgage and have the property free from the lender's charge.
What are the legal requirements for a valid mortgage deed in England and Wales?
Answer: It must be a deed — signed, witnessed, and delivered — and must comply with the Law of Property (Miscellaneous Provisions) Act 1989
A legal mortgage must be created by deed under section 52 of the Law of Property Act 1925, meeting the requirements of the LP(MP)A 1989 — signed, witnessed, and delivered.