What is a 'release clause' in a Delaware subdivision mortgage?
Why A mortgage provision allowing individual lots to be released from the blanket mortgage lien upon payment of a specified portion of the loan, permitting lot-by-lot sales Is Correct
Answer B: A mortgage provision allowing individual lots to be released from the blanket mortgage lien upon payment of a specified portion of the loan, permitting lot-by-lot sales
Exam Tip: Contracts
Contract questions frequently test the essential elements required for a valid contract. Remember: competent parties, mutual consent, lawful object, and sufficient consideration. Watch for void vs. voidable distinctions.
Key Contracts Terms in This Question
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Key Terms to Know
A financial claim against a property that serves as security for a debt or obligation, giving the creditor the right to foreclose if unpaid.
ContingencyA condition in a purchase contract that must be satisfied before the sale can proceed to closing.
Option ContractA contract giving the buyer the right, but not the obligation, to purchase a property at a specified price within a specified time period.
Discount PointsPrepaid interest paid to a lender at closing to reduce the mortgage interest rate, with each point equal to 1% of the loan amount.
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