If Mr Blandings bought the property ( including the house ) from the owner, in what legal way could the owner/seller demand payment of the mortgage after Mr Blanding's razes the house?
A mortgage is a secured loan. The property serves as collateral to secure the loan. When the house is gone, the collateral (excluding the land) is gone.
Additionally, the mortgage contract probably included specific language dealing with such situations. As I recall, Blanding's lawyer friend Bill quotes from the contract to explain it.
I see. Thanks for the reply.
shareDidn't really get this either.
He bought the house, so the previous owner would discharge his mortgage at that point and he would no longer own the land.
Not sure why the previous owner's mortgage still comes into it after that point. I guess Blandings' own mortgage could become invalidated if it was secured against the house...
The previous owner, not a bank, holds the mortgage. Blandings is making mortgage payments to the previous owner.
shareSo you're saying the previous owner signed over the property to Blandings but HE, not a bank, was acting as the mortgage lender?
I've never heard of that before... I guess it could be possible though.
My parents bought half of a duplex multi-family back in 1958. No bank wanted to bother to write a mortgage. The oil delivery man wrote them a 15-year mortgage for $38.00 a month!
shareHa - Thanks, this is interesting stuff!
So did the oil delivery man own / build the duplex and then mortgage your parents their apartment? I really had no idea this sort of thing happened...
No, he didn't. He just offered to do the mortgage. I remember when the last payment was due in 1973. He came over to the house with a bottle of champagne.
shareGreat story this - different times!
So let's see if I've got this right then - He gave the full purchase amount to the previous owners and then took the mortgage payments from your parents?
I take it they must have been good friends or something? Or was it just a better interest rate for the guy than he'd get from a bank and he had the insurance of getting the property if they defaulted?
This was far more common back then.
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