The intention of the parties to a mortgage transaction is not that the property should be permanently transferred to the mortgagee(lender); the intention is that the property be returned to the mortgagor when the loan is serviced. The law of real property tries as much as possible to ensure that parties are bound by this intention. However, on the legal due date, where the mortgagor does not pay up the loan, the right of sale of the mortgagee arises.

Does this mean that the mortgagor can no longer redeem his property?

One of the rights of a mortgagor is the equitable right of redemption. This right is to the effect that a mortgagor can still redeem his property even after the legal due date. This right is based on the claim that “once a mortgage, always a mortgage”. The equitable right of redemption allows the mortgagor to get his property back even where the date for redemption has lapsed. He is to get his property whenever he pays up the loan, as long as the property has not been sold.

This right becomes extinguished at the moment that the right of sale of property becomes exercisable. Thus, it is said that equitable right of redemption exists as long as right of sale of the mortgagee has not become exerciseable.

It should be noted that any of the circumstances below will extinguish the equitable right of redemption:

1. where the mortgagor breaches any term of the mortgage contract.
2. where the mortgagor owes arrears of interest for two months.
3. where the mortgagee sends notice to the mortgagor to request for the principal sum and he fails to pay within three months.

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