Mortgages
Anthony is the registered proprietor of a Torrens title property on Sydney’s north shore. He
needs funds to renovate and sell the property and so he asks his mother, Sue, if she can lend
him the $150,000 that he needs. She agrees but requests that he give her a letter noting the
terms of their agreement. Instead of the letter, Anthony hands over the Certificate of Title (the
folio of the register), together with a signed, but blank, Transfer of the property saying, “Keep
these safe -
you’ll be able to sell the house to get the money back if anything should happen
to me.”
Anthony quickly spends the $150,000 but has not completed his renovation. He asks his old
friend David if he could make a loan of a further $150,000 so that he can get the property to
market readiness. At David’s request Anthony executes a mortgage in registrable form.
The
$150,000 is repayable in one year. The mortgage agreement also stipulates that David has an
option to purchase the property at any time within the next 3 years at a price of $400,000. The
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- '18
- james
- Deed
