Mortgages
A mortgage is a security interest over land securing a debt. The law protects the borrower's equity of redemption while giving the lender enforcement remedies.
What "Mortgages" covers
- A legal mortgage of registered land is created by a charge by deed expressed to be by way of legal mortgage and must be completed by registration (LPA 1925 s.87; LRA 2002 s.27).
- The borrower's equity of redemption is protected: no clogs or fetters on the right to redeem, and an option to purchase contained within the mortgage itself is void (Samuel v Jarrah Timber and Wood Paving Corp Ltd [1904]) — though a genuinely separate, later option can be valid (Reeve v Lisle).
- Postponement of redemption and collateral advantages are valid only if not unconscionable or a restraint of trade (Knightsbridge Estates; Kreglinger).
- Lender's remedies: sue on the covenant to repay, possession, sale, appointment of a receiver, and foreclosure (now rare).
- The power of sale must have arisen (legal mortgage by deed, mortgage money due) and become exercisable (s.103 conditions) before it is used (LPA 1925 ss.101, 103).
- On sale the mortgagee must take reasonable care to obtain a proper price (Cuckmere Brick v Mutual Finance); proceeds are applied under LPA 1925 s.105.
- Possession of a dwelling is regulated: the court may adjourn or suspend under the Administration of Justice Acts 1970 s.36 and 1973 s.8 where sums can be repaid in a reasonable period.
Key cases & statutes
The authorities and provisions most likely to matter for this subtopic:
How it's tested in SQE1
SQE1 uses single best answer questions: a short factual scenario, one precise question, and five options of which only one is the best answer on the law applied to the facts. For mortgages, expect to be asked what the correct legal position is, what a party may or must do, or which outcome follows — with more than one option looking arguable. Reading the facts carefully and eliminating the near-misses is the skill that earns the mark.
Where candidates lose marks
- Confusing when the power of sale arises (s.101) with when it becomes exercisable (s.103).
- Suggesting the lender owes a general fiduciary duty on sale — the duty is to take reasonable care as to price.
- Overlooking undue influence: a lender may be fixed with notice where a surety charges the home (Etridge).
Learn this subtopic in the course
A video lesson, notes and exam-style practice on mortgages.
FAQ
Is mortgages tested on SQE1?
Yes — mortgages is part of the SQE1 Land Law syllabus (FLK2) and can appear in single best answer questions.
How is mortgages examined in SQE1?
SQE1 tests it by application: you're given a realistic scenario and choose the single best answer from five options. The focus is on using the law correctly, not reciting it — knowing the leading authorities (LPA 1925 s.85-87, LPA 1925 s.101) helps.