In addition to an obligation to repay principal and interest, the mortgage will invariably:
oblige the mortgagor to repair and insure the property, and
contain restrictions on the mortgagor’s ability to let it
A mortgagee's remedies include sale and the appointment of a receiver. Taking possession and foreclosure will rarely be encountered in practice.
The mortgagee’s power of sale arises under section 101 of the Law of Property Act 1925 (LPA 1925) and is regulated by LPA 1925, s 103. This allows a mortgagee to instigate possession proceedings once:
two current monthly instalments have fallen due and remain unpaid, or
in the case of a repayable on demand mortgage, a notice requiring payment of the mortgage money has been served and payment has not been made three months after service
To provide a level of protection to defaulting homeowners, section 36 of the Administration of Justice Act 1970 provides that where the mortgagee is suing for possession and the mortgagor is likely to be able within a reasonable period
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