Mortgage Matrix and Bank Lending; An Evaluation of Mortgage Consent
22 Pages Posted: 21 May 2017
Date Written: May 19, 2017
The act of bank lending has fast become a globally acceptable transaction as it has facilitated several investment schemes with the availability of financial support. However, this has not been without several hitches as to the consent requirement, especially in Nigeria, which must be given by the Governor to facilitate such a transaction. This article examined the impact of mortgage consent, as a security for bank lending, towards guaranteeing that a loan obtained by a mortgagor will be repaid, and in the event that the mortgagor fails to repay, the mortgagee is entitle to recoup his mortgage loan from the security. The article revealed that the doctrine of mortgage consent is paramount in the provisions of Land Use Act, and failure to comply with such provision will lead to the invalidity of any mortgage transaction. It is the proposition of the writer that the court should interpret the provisions of Land Use Act in a way as not to constitute a ridicule to the judicial process, and to encourage economic investment be providing a smooth opportunity for banks to recoup their loans when a mortgagor fails to repay a loan. This article established that mortgage consent is the only guarantee or assurance needed to back up a security or collateral given to the mortgagee and to subsequently facilitate bank lending.
Keywords: Banking sector, Mortgage, Governor’s consent, Alienation, Security
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