Humber/Ontario Real Estate Course 4 Exam Practice

What describes the owner redeeming property free of mortgage?

1. Receiving mortgagee-signed discharge

2. Repaying debt and penalties in full

3. Discharge of equitable mortgage

4. Gaining clear title without other debts

5. Partial payments to avoid foreclosure

6. Negotiating long-term payment plans

The correct answer is: Receiving mortgagee-signed discharge

The process of the owner redeeming property free of a mortgage primarily involves gaining legal clarity over the ownership of the property. When an owner redeems their property, they are essentially settling the mortgage obligations entirely, which includes discharging the mortgage and attaining a clean title to the property. Receiving a mortgagee-signed discharge is a critical step in this process. This discharge signifies that the lender agrees the debt has been fully satisfied, thus removing the lien on the property and confirming that the owner is now the outright possessor of the property without any claims from the mortgagee. While repaying debt and penalties in full is indeed necessary to achieve redemption, the act of obtaining a signed discharge is the definitive action that evidences the completion of that redemption process and relieves the property from the mortgage. A clear title is obtained post-discharge, and that is what confirms that the property is free from any encumbrances. Other options may touch upon related concepts but don’t encapsulate the essence of what it means to "redeem property free of mortgage" as directly as obtaining the discharge from the mortgagee.