CHAPTER 8.02. Release of Mortgage

• Jurisdiction: United States

8.02. Release of Mortgage

Releases of mortgaged property from the lien of a mortgage, whether all or only part of the mortgage property,¹⁶ must be executed under seal and acknowledged in the same manner as required for deeds, and will become effective upon the date of recording in the recorder of deeds office of the county in which the real property is located.¹⁷ A release of a portion of the mortgaged property does not operate as a release of any other part of the mortgaged property from the lien of the mortgage.¹⁸ Where the financing contemplates the mortgagor's subdivision and sale of portions of the collateral, it is essential to provide in the mortgage for partial releases; otherwise, the mortgagor has no right to a release of the mortgage lien from any portion of its property absent payment in full to the extent permitted by the loan documents.¹⁹

--------

Notes:

^[16] The parties may wish to release all of the mortgaged property from the mortgage lien when the secured obligation remains outstanding but the mortgaged property is no longer to serve as collateral for that unsatisfied obligation.

^[17] 25 Del. C. § 2110.

^[18] Id.

^[19] There is authority for a release right being for the benefit of a subsequent purchaser of the property in question. See Osborne on Mortgages § 305 at 877 (1951); Kratovil, Modern Mortgage Law and Practice § 461 at 300...